Bizbits

BoB takes over HK company

MUMBAI: Bank of Baroda BoB on Friday took over IBU International Finance, a deposit-taking company in Hong Kong, by buying out the stakes of Indian Bank and Union Bank of India. BoB has bought the stakes of the two banks 8212; 33 per cent each 8212; for Rs 72 crore. It has paid a 55 per cent quot;goodwillquot; premium to buy the stakes. The move to buy out the banks8217; stakes was triggered by the Hongkong Monetary Authority8217;s decision not to allow a multi-parent financial institution in Hong Kong. The Reserve Bank of India persuaded BoB to pick up the stakes of the banks and turn IBU International into a wholly owned subsidiary, the sources said. Banking analysts, however, question the deal8217;s pricing. quot;IBU Hongkong has posted losses. The bank could have picked up the stakes at a cheaper price,quot; a senior analyst said.