{"id":188371,"date":"2023-04-11T10:00:00","date_gmt":"2023-04-11T14:00:00","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=188371"},"modified":"2023-04-11T10:05:27","modified_gmt":"2023-04-11T14:05:27","slug":"ocbc-and-sembcorp-industries-lead-q1-buyback-considerations","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/stocks\/ocbc-and-sembcorp-industries-lead-q1-buyback-considerations\/","title":{"rendered":"OCBC and Sembcorp Industries Lead Q1 Buyback Considerations"},"content":{"rendered":"\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" width=\"646\" height=\"599\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p1.png\" alt=\"Primary listed stocks that filed highest buyback considerations Q1 2023\" class=\"wp-image-188373 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p1.png 646w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p1-300x278.png 300w\" data-sizes=\"(max-width: 646px) 100vw, 646px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 646px; aspect-ratio: 646\/599;\" \/><\/figure>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" width=\"643\" height=\"267\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p2.png\" alt=\"Monthly buyback consideration for SGX primary-listed stocks\" class=\"wp-image-188372 lazyload\" data-srcset=\"https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p2.png 643w, https:\/\/ibkrcampus.com\/campus\/wp-content\/uploads\/sites\/2\/2023\/04\/BT-Inside-Insights_10Apr_p2-300x125.png 300w\" data-sizes=\"(max-width: 643px) 100vw, 643px\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 643px; aspect-ratio: 643\/267;\" \/><\/figure>\n\n\n\n<p>In the first quarter of 2023, more than 40 Singapore primary-listed companies bought back shares with a total consideration of S$126 million, less than the consideration tally of S$150 million in Q4 2022 and S$298 million in Q1 2022.<\/p>\n\n\n\n<p>The two stocks that filed the highest buyback consideration in Q1 2023 were&nbsp;OCBC and&nbsp;Sembcorp Industries.<\/p>\n\n\n\n<p>During the quarter, the Straits Times Index (STI) generated a 0.2 per cent price gain, with dividends boosting the total return to 0.8 per cent.<\/p>\n\n\n\n<p>Three other STI stocks that conducted buybacks during the quarter were&nbsp;Singapore Exchange,&nbsp;Singapore Technologies Engineering and&nbsp;Venture Corporation.<\/p>\n\n\n\n<p>The buyback considerations of these five companies made up just over three-fifths of the S$126 million in combined consideration for Q1 2023.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-ocbc\">OCBC<\/h2>\n\n\n\n<p>In Q1, OCBC bought back 3.2 million shares at an average price of S$12.50, including stamp duties, clearing charges etc paid or payable for the shares.<\/p>\n\n\n\n<p>As of Mar 31, OCBC had bought back 0.44 per cent of its issued shares (excluding treasury shares). The base date for determining the exact 0.44 percentage is the date of the buyback resolution, which was Apr 22, 2022.<\/p>\n\n\n\n<p>OCBC maintains that shares purchased under the share buyback programme are held as treasury shares, and recorded as a deduction against share capital, and may be subsequently cancelled, sold, or used to meet delivery obligations under employee share schemes.<\/p>\n\n\n\n<p>As the company noted in the capital management section of its annual report for 2022, during the financial year ended Dec 31, 2022, the bank purchased 20.9 million ordinary shares for S$250 million as part of its share buyback programme, while 24.2 million treasury shares were delivered to meet obligations under its employee share schemes.<\/p>\n\n\n\n<p>OCBC\u2019s employee share schemes include the Share Option Scheme, the OCBC Employee Share Purchase Plan (ESPP) and the OCBC Deferred Share Plan.<\/p>\n\n\n\n<p>OCBC has ceased granting share options under the OCBC Share Option Scheme 2001 effective from financial year 2018 remuneration.<\/p>\n\n\n\n<p>The scheme, which was extended from 2011, had ceased operation on Aug 2, 2021 with share options granted in prior years continue to be outstanding until the options lapse or are exercised by the recipients.<\/p>\n\n\n\n<p>The OCBC ESPP was implemented for all employees of the participating companies in the group, including executive directors, to inculcate in all participants a stronger and more lasting sense of identification with the group.<\/p>\n\n\n\n<p>It is a savings-based share ownership plan to help employees own ordinary shares in the bank through their monthly contributions via deductions from payroll and\/or funds from the Central Provident Fund.<\/p>\n\n\n\n<p>The OCBC Deferred Share Plan aims to increase the performance orientation and retention factor in compensation packages of executives and foster an ownership culture within the organisation.<\/p>\n\n\n\n<p>It also aligns the interests of executives with the sustained business performance of the bank.<\/p>\n\n\n\n<p>Group executives holding the rank or equivalent rank of assistant manager and above, and any group executive director selected by the remuneration committee, are eligible to participate in the plan.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-sembcorp-industries\">Sembcorp Industries<\/h2>\n\n\n\n<p>In Q1 2023, Sembcorp Industries bought back 6,415,500 shares at an average price of S$3.99, including stamp duties, clearing charges etc paid or payable for the shares.<\/p>\n\n\n\n<p>Sembcorp Industries noted in its annual report for 2022 that during the financial year ended Dec 31, 2022, it acquired 8,947,300 ordinary shares in the company by way of on-market purchases.<\/p>\n\n\n\n<p>These were acquired between Sep 15 and Dec 7, at an average price of S$3.13, including stamp duties, clearing charges etc paid or payable for the shares.<\/p>\n\n\n\n<p>The company added that in 2022, a total of 5,698,878 treasury shares were re-issued pursuant to the Performance Share Plan (PSP) and Restricted Share Plan (RSP).<\/p>\n\n\n\n<p>Sembcorp Industries also noted that as of Dec 31, 2022, it held 10,763,948 of its own uncancelled shares as treasury shares that may be re-issued upon the vesting of performance shares and restricted shares under the PSP and RSP respectively.<\/p>\n\n\n\n<p>As of Mar 31, 2023, Sembcorp Industries had bought back 0.86 per cent of its issued shares (excluding treasury shares) as of the date of the buyback resolution, which was Apr 21, 2022.<\/p>\n\n\n\n<p>Sembcorp Industries maintain the PSP and RSP help to motivate key management personnel to keep striving for the group\u2019s long-term shareholder value.<\/p>\n\n\n\n<p>In addition, its share-based incentive plans aim to align the interests of participants and shareholders, to improve performance and achieve sustainable growth for the company.<\/p>\n\n\n\n<p>In 2021, the board of Sembcorp Industries approved a five-year Transformation Incentive plan (PSP-TI) under the PSP, to further strengthen the alignment of the long-term incentive of the group president and chief executive officer, as well as key management personnel, to the group\u2019s brown-to-green transformation strategic goals.<\/p>\n\n\n\n<p>The PSP-TI is linked to specific long-term environmental, social and governance transformation goals including greenhouse gas emissions, intensity reduction, gross installed renewable energy capacity, sustainable solutions\u2019 profit and sustainable land banking and land sales.<\/p>\n\n\n\n<p>Non-STI stocks that led the buyback consideration tally in Q1 2023 included&nbsp;Keppel Reit,&nbsp;Comba Telecom Systems Holdings,&nbsp;Yangzijiang Financial Holding,&nbsp;Nanofilm Technologies International and&nbsp;Best World International.<\/p>\n\n\n\n<p>Share buyback information can be found on the company disclosure page on the Singapore Exchange website, using the Announcement category and sub-category of Share Buy Back-On Market.<\/p>\n\n\n\n<p>Motivations for share buybacks can include employee compensation plans or long-term capital management.<\/p>\n\n\n\n<p><strong><em>Inside Insights is a weekly column on The Business Times,&nbsp;<a href=\"https:\/\/www.businesstimes.com.sg\/companies-markets\/ocbc-and-sembcorp-industries-lead-q1-buyback-considerations?force_isolation=true\">read<\/a>&nbsp;the original version.<\/em><\/strong><\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally Posted April 10, 2023 &#8211; <a href=\"https:\/\/www.sgx.com\/research-education\/market-updates\/20230410-ocbc-and-sembcorp-industries-lead-q1-buyback\">OCBC and Sembcorp Industries lead Q1 buyback considerations<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In the first quarter of 2023, more than 40 Singapore primary-listed companies bought back shares with a total consideration of S$126 million.<\/p>\n","protected":false},"author":186,"featured_media":188372,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[4,8,9,22,26,3],"tags":[196,4372,405,11404,744,44],"contributors-categories":[13625],"class_list":{"0":"post-188371","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-asia","8":"category-region","9":"category-securities","10":"category-stocks","11":"category-text-articles","12":"category-traders-insight","13":"tag-asia","14":"tag-primary-listed-stocks","15":"tag-sgx","16":"tag-share-buybacks","17":"tag-singapore","18":"tag-stocks","19":"contributors-categories-singapore-exchange"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.4) - 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