Domestic transactions rule 2014 deal activity among APAC banks

Korea was a hub of bank activity.

The 26 deals in 2014 announced by Asia-Pacific banks covered by SNL Financial totaled US$16.79 billion, compared to 25 deals with a disclosed deal value of US$21.81 billion in 2013.

According to a release from SNL Financial, deal activity in 2014 was dominated by domestic transactions, led by ongoing consolidation in South Korea.

Further, in 2014, there was an increase in domestic transactions compared to the year prior, with 54.5% of the acquisition deals made between domestic companies, up from 43.8% in 2013.

South Korea was a hub of bank activity in 2014, with seven deals announced — more than any other Asia-Pacific country.

India and China accounted for five and three announced deals, respectively. Of the 12 domestic transactions in 2014, four involved South Korean banks, making the country the most active in terms of domestic consolidation.

Here's more from SNL Financial:

Over the last five years, China has been the most active Asian country in terms of deal volume. The country saw 25 bank transactions totaling US$39.09 billion between 2010 and 2014, accounting for more than 24% of the deal volume in the Asia-Pacific region.

Also in 2014 was the announcement of a proposed three-way merger between CIMB Group Holdings Bhd., RHB Capital Bhd. and Malaysia Building Society Bhd. in a deal that would have created Malaysia's largest banking group by assets.

However, the deal was terminated Jan. 14 after the companies failed to work out the terms. CIMB Group acting group CEO Zafrul Tengku Abdul Aziz said in a Jan. 14 release that the three companies were not able to "arrive at a value-creating transaction for all stakeholders."

"Protecting and creating stakeholder value is paramount to all parties and given the changes in environment we could not conclude a case to proceed further," Zafrul added.

Hong Kong saw the highest disclosed deal value in 2014 at US$6.01 billion, largely due to Singapore-based Oversea-Chinese Banking Corp. Ltd.'s acquisition of Hong Kong-based OCBC Wing Hang Bank Ltd. for US$4.95 billion in July 2014, which was the largest deal based on announced deal value among SNL-covered Asia-Pacific banks in 2014.

The second-largest transaction of 2014 was the US$2.40 billion proposed acquisition of Bengaluru, India-based ING Vysya Bank Ltd. by Mumbai-based Kotak Mahindra Bank Ltd. The deal is expected to close in the second half of 2015, subject to regulatory and shareholder approvals.