UOB injects $316m in capital to China subsidiary
Capital will be used to develop cross-border services and push sustainability strategy.
UOB has made a capital injection of over $316m (RMB2b) to its subsidiary in China.
UOB China plans to use the new capital to support its clients’ cross-border needs, as well as push forward its sustainability strategy by helping clients grow sustainably.
“With enhanced intra-regional connectivity, coupled with increased cross-border trade and investments, we are investing in our capabilities to support closer connectivity between China and ASEAN,” said Wee Ee Cheong, deputy chairman and CEO of UOB, on the capital injection.
“We will strengthen our support to our clients as they take advantage of the opportunities arising from regional connectivity initiatives, such as the newly-enforced Regional Comprehensive Economic Partnership,” Cheong added.
This is UOB’s second capital injection to UOB China, following around $390m (RMB2.5b) increase in its capital in 2015.
The bank plans to funnel the increased capital into three key areas: connectivity, progressive solutions, and sustainability.
UOB China will reportedly establish and expand client relations in sectors “that are strong drivers of China’s economy” and also deepen relationships with existing anchor clients.
The bank also shared plans to strengthen its strategic partnership with Hengfeng Bank by jointly tapping cross-border business potential.
UOB China is also developing more solutions on commodities hedging and rates.
The bank’s China business will also use the money to push forward its sustainability strategy. This follows after UOB China recorded double-digit year-on-year growth in the number of its clients taking up green financing solutions.
Through the new capital, UOB China plans to support companies from key sectors that align with China’s carbon emission reduction action plan, in areas such as renewable energy, energy saving projects and industrial upgrades, as well as sectors involved in the circular economy.
UOB China’s net profit before tax hit a record high in 2021, or more than double of that in 2018. Since its incorporation in 2008, it has maintained a compound annual revenue growth of 13%.