Chapter 401: The beginning of the investment in Hang Seng Bank and real estate cashing out

"He Shanheng?" Yang Wendong thought about it, nodded and agreed, and said, "Okay, what time?"

"He said it's according to your schedule." The assistant added, "You are free the day after tomorrow afternoon."

Yang Wendong said, "Okay, let's meet at Presidential Suite 1 of the Four Seasons Hotel the day after tomorrow afternoon."

The assistant said, "Okay, I'll arrange it right away."

On the third day, Yang Wendong met He Shanheng at the Four Seasons Hotel. After some greetings,
Ho Sin Hang went straight to the point and said, "Mr. Yang, what do you think of my Hang Seng Bank?"

"How about this? What does it mean?" Yang Wendong asked with some confusion.

Yang Wendong really didn't understand this unclear sentence.

He Shanheng smiled and said, "I mean from the perspectives of future scale, development trend, and current potential?"

"Of course these are good." Yang Wendong nodded and said, "Now Hang Seng Bank is the largest Chinese bank in Hong Kong, and its scale is much larger than that of the original Liao Chong Hing Bank;
And everyone knows what happened to Liu Chong Hing Bank back then. It expanded without regard for the risks, but today’s Hang Seng is doing much better.”

Although Hang Seng Bank is about to experience a run, which will cause the collapse of the entire bank, it cannot be blamed because no bank can withstand an unlimited run, no matter how normal it is;
Although Hang Seng Bank has developed rapidly in recent years, it has not been aggressive. It has relied entirely on the reputation and foundation of its early operations, and then took advantage of the economic boom in Hong Kong in the early 60s to develop rapidly.

"Haha, thank you for the compliment, but I think I am still far behind Mr. Yang's Changxing Group." He Shanheng smiled and asked, "Is Mr. Yang interested in investing in my Hang Seng Bank?"

Yang Wendong asked in surprise: "Hang Seng Bank is accepting financing? You should not be short of money, right? Do you have any big plans?"

This did surprise him a bit. Hang Seng Bank had developed so smoothly in recent years, so there must be no problem with funding within its existing business scope, unless there were any large investment plans that required additional funds. For example, Bank of East Asia had introduced external funds in order to expand in the past few years.

However, Yang Wendong’s capital was not strong enough at the time, and he could not provide sufficient strategic support to Bank of East Asia, so he did not seek to participate in this matter.

"I don't have any major investment plans, but I am planning to list Hang Seng," said Ho Sin Hang with a smile.

"Hang Seng's listing?" Yang Wendong paused and said, "The Hong Kong Stock Exchange is not very welcoming to Chinese capital. It's not easy to get in."

Before Li Fook-shuo founded the Far East Exchange in 1969, there was only one Hong Kong Stock Exchange in Hong Kong, which was naturally controlled by British capital. Basically, it only welcomed British capital or a few special public enterprises. It was difficult for other Chinese capital to list here.

The logic is very simple. The number of leeks is limited. The big British companies themselves don’t have enough to reap, so how could they agree to other Chinese to join in? Especially if Chinese capital obtains a lot of funds and fame after listing, it will only compete with British capital for the market. After all, most Hong Kong companies make money within Hong Kong Island.

"It is difficult, but there are opportunities." Ho Sin Hang said with a smile: "Most of the companies listed on the Hong Kong Stock Exchange are British-owned, which has caused dissatisfaction among many Chinese capitals, media and even Chinese officials.

Hang Seng Bank is now the largest Chinese bank in Hong Kong, so it is only natural for me to take the lead in promoting this matter. As long as I succeed this time, it will be much easier for other Chinese companies to go public in the future.”

Yang Wendong nodded and said, "That's true, but if we do this, we will offend a lot of British capital and even the Hong Kong government. Is it worth it?"

"It's worth it. No matter from my perspective or the perspective of the Chinese, someone has to do this." Ho Sin Hang added: "Hang Seng Bank has developed to where it is today. If it wants to go further, it needs to go public. Only by going public can it not only gain great fame in Hong Kong, but also have the opportunity to enter other overseas markets."

"Are you planning to enter other overseas markets? That's not easy," Yang Wendong asked.

Ho Sin Hang nodded and said, "It's not easy, but we have to try anyway. Otherwise, what future do we have if we are trapped in a city like Hong Kong? The upper limit is dead.

Only by going overseas and making achievements overseas can we make further progress, just like Yang Sheng’s Changxing Industry.”

"Well, if it goes public, it will be easier to invest overseas." Yang Wendong agreed and said, "Mr. He is really ambitious."

Historically, Hang Seng Bank was completely acquired by HSBC after a bank run in 65. Although the Ho family still held positions and had management rights, they no longer had any decision-making power. It is estimated that the original major plans were also stopped by HSBC.

But it is normal to think about it. A man like Ho Sin Hang is extremely ambitious. After becoming a top banker in Hong Kong, it is normal for him to find ways to invest overseas.

Although this road is extremely difficult, every entrepreneur will keep moving forward despite knowing the difficulties ahead. If you don’t even have this determination, it is impossible to grow big.

"Same here. Mr. Yang is much better than me. I heard that he is planning to invest in the UK?" He Shanheng smiled and said, "But the UK is a bit chaotic recently, so you have to be careful."

Yang Wendong said: "I know. I won't get involved in those messy things. The people I recruit will also be white people to avoid trouble."

Britain was in chaos in the 60s because there was a shortage of people after World War II, so Britain relaxed restrictions on naturalization for people from its colonies. As a result, a large number of blacks, Indians, people of color, etc. entered Britain, and within a dozen years the number reached as high as one million.

As a result, local extreme right-wing forces rose up, and all parties were in chaos.
"With Mr. Yang's intelligence, he must have plans in this regard. I am the one who is worried." Ho Sin Hang continued, "Let's get back to business. Hang Seng Bank is planning to go public this time, and it also needs more shareholders to join in. First, it is also a requirement for going public, which requires multiple shareholders. Second, considering the combination of the strength of multiple Chinese companies, we will have a higher chance of success."

"How much do you want me to invest?" Yang Wendong asked.

Ho Sin Hang said: "2-3% is enough, not too much, not too little. I will also give you, Mr. Yang, a non-executive director position. How about that?"

"What about the valuation?" Yang Wendong asked again.

He Shanheng shook his head and said, "It's hard to say at the moment. Once I find other Chinese capital, I will make a unified estimate at that time."

"That's fine." Yang Wendong nodded and said, "Then 2 or 3 percentage points is no problem. Once you confirm it, we'll consider the next step."

Although Hang Seng will face a run next year, it is still unknown whether he can save it with his ability. But even if not, he will have the opportunity to obtain shares of Hang Seng under HSBC in the future, which is also cost-effective. After all, Hang Seng's foundation has been laid very solidly by Ho Sin Hang, and it will also be a good investment under HSBC's management.

Only by becoming a shareholder first, even a small shareholder, can you intervene in this matter with justification at that time, and it will not be considered as going against HSBC.

Ho Sin Hang said with a smile: "Okay, when there is progress, I will invite Mr. Yang and other shareholders to go to the headquarters of Hang Seng Bank to discuss this matter."

"Okay." Yang Wendong nodded.
After chatting for a while, He Shanheng left.

After returning to Changxing Building, Yang Wendong immediately called Zheng Zhijie and asked, "How much loan does our group have at Hang Seng Bank?"

"About HK$4000 million." Zheng Zhijie replied: "In recent years, we have acquired a lot of properties and land, and we paid a small amount ourselves, while Hang Seng Bank and East Asia paid the majority.

Of the two banks, Hang Seng Bank is larger in scale, so it has more co-rental facilities. In addition, some of Changxing Industrial's factory investments are also in cooperation with Hang Seng Bank, but not many."

"That's about it." Yang Wendong nodded, and then said: "It's almost the middle of the year now, according to our previous plan, let's start cashing out the non-core properties in our hands.

Except for some high-quality street-side shops in Central Building and Hong Kong Island, or some other high-quality properties, all other properties will be sold off and all cashed out before the end of the year. "

If it is just a small piece of land or property, then it is not a problem to cash out in the last one or two months; but if it involves an area of millions of square feet, it must be cashed out earlier to give the market some buffer time to absorb it.

Not making the last penny is a famous saying of many bigwigs. This statement itself is correct, but the reality is that they cannot make the last penny because it takes time to cash out large-scale assets.

"Okay, I'll arrange it right away." Zheng Zhijie agreed. He had known about his boss's plan for a long time. He had started strategic contraction last year and was ready to completely exit and cash out today.

Yang Wendong added: "In addition, the increase in the cashed-out funds will be counted as ours, and the loans owed previously will also be directly repaid to the major banks."

"Return it to the bank? Don't you consider keeping some of it for other uses?" Zheng Zhijie asked in return.

Yang Wendong shook his head and said, "In the short term, I am not optimistic about Hong Kong's economy. As for investments in other places, we can just cooperate directly with local banks, which can also win over local forces."

This can be considered as a gift from Yang Wendong to Hang Seng Bank before the bank run. With some of the funds after cashing out, it can at least survive the bank run for two more days.
Of course, whether it can provide decisive help or whether Hang Seng will lend out this money in the next six months is beyond his control.

Zheng Zhijie agreed and said, "Okay, I understand."

"Well," Yang Wendong said, "In addition to real estate, the existing leasing business also needs to sign a 5-year agreement with the customer as soon as possible, even if it's cheaper."

The current cheapness naturally refers to the current rent, but by the end of next year, Hong Kong's house prices and rents will have fallen by more than half; by 67, it will be only %.

If it was a personal lease, Yang Wendong would not be so ruthless, but since they are all doing business, it depends on your own vision. Anyway, nothing will be forced.

Of course, if some companies really cannot afford the rent and cannot rent out the property after they withdraw, he can also reduce the rent appropriately, which can also gain a certain good reputation and kill two birds with one stone.

Zheng Zhijie smiled and said, "No problem, this has been planned for a long time."

PS: Please give me a monthly ticket.

What a coincidence, the book talks about a bank run, and there was a bank run in real life...

(End of this chapter)

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