Hong Kong tycoon Li Ka-shing, the Warren buffet of Asia, has bought heavily into bank of East Asia after stocks of the Asian bank plummeted more than 11 percent.
Warren E. Buffett, the America’s most famous investor and one of the world’s richest men, announced on Tuesday that he would invest $5 billion in Goldman Sachs, the embattled Wall Street titan, in a move that could bolster confidence in the financial markets.
Following his lead, Li Ka-shing, who has built a massive empire ranging from shipping to education in Asia and beyond, on Thursday reportedly swooped in to buy Bank of East Asia’s shares, bolstering confidence and Asia and helping Hong Kong’s fifth-ranked lender stay afloat.
Hong Kong tycoon Li Ka-shing bought BEA shares on Wednesday to show his confidence in the bank’s future, a source close to the bank was quoted as saying by the Hong Kong Economic Times.
The South China Morning Post, citing an unnamed senior banking source, said the billionaire chairman of Cheung Kong Holdings had “bought the shares heavily”.
BEA stock was quoted up 3.4 percent in early Thursday trade after closing down 6.9 percent on Wednesday.
Analysts seem to think Asia will not be drastically impacted by the global slowdown. As Ajay Kapur, the chief global strategist at Mirae Asset, a large South Korean investment bank, told SCMP, “We’ve already had our crisis, so it’s pretty difficult to blow up twice in a decade.”
He added, “Each region gets a chance to blow up, and this is not Asia’s turn.”
Several hundred depositors queued up Wednesday outside the Bank of East Asia in Hong Kong to withdraw their money, underlining widespread public nervousness in Asia that Wall Street’s recent difficulties might spread across the Pacific.
Bank of East Asia also told the International Herald Tribune that after the bank run had started, that its exposure to the Lehman Brothers bankruptcy was US$54 million and its exposure to American International Group (AIG), which that was extended credit by the U.S. Federal Reserve last week, was US$6.4 million.
