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October 27, 2006
ICBC and the World's Biggest Swinging Bank Award
The IPO and the "UTD" Syndrome
ICBC, one of China's big four state banks, has now privatized. Or so it might be presumed, as the bank has issued stock; the extent to which the bank is no longer subject to state direction remains a significant question.
At a minimum, ICBC can now claim the World's Biggest Swinging Bank Award with an IPO of gargantuan proportions. (Investment bankers, gasping with dropped jaws, raise their heads in an expression of collective awe.)
The stock opened up 17-plus percent. But we think it more than likely that the UTD (Up, Then Down) Syndrome, a classic symptom of the chronic illness of Chinese stock markets, will shortly take effect and the stock will plum the depths of many an investor wallet. We'll keep an eye on the share price over time -- not because we have money in it (if we'd had, we would have been out of it by now.), but simply for the vicarious thrill of the roller-coaster ride.
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