Hong Kong billionaire follows Buffet
Hong Kong’s richest man followed Warren Buffett’s example on Thursday, wading into troubled waters to pour on a little oil – and probably make a bit of profit at the same time.Skip to next paragraph
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Li Ka-shing is a flamboyant self-made billionaire with a reputation for funding good works. In what might be seen as an expression of his charitable nature, he let it be known on Thursday that he had made “a personal investment” in the crisis-struck Bank of East Asia.
That’s the bank which had been besieged by thousands of frightened customers on Wednesday in the region’s first major bank run since the world financial crisis broke last year.
The Bank of East Asia is the fifth largest bank in Hong Kong, Asia’s financial hub. It’s the kind of institution whose fate has major consequences for everyone else in the system. So when panicked depositors lined up to withdraw their money and the bank’s stock plunged by seven percent in a day, that made people nervous.
Li Ka-shing’s very public vote of confidence, buying shares in the bank on Thursday morning, shored things up. The stock price rose more than three percent. Hong Kong financiers breathed more easily, and Mr. Li made a tidy little sum in a few hours of public spirited investing.
Around Hong Kong, Li's known as "Superman" for his golden touch. He is the 11th wealthiest man on the planet, according to Forbes magazine.
This investment echoes Mr. Buffett’s purchase of $5 billion worth of Goldman Sachs on Wednesday. That move reassured many observers, from Main Street to Wall Street, who thought that if a man with Buffet’s investment acumen is buying, perhaps there's a light at the end of this tunnel.
But you can bet that Buffett has done his sums. He would hardly have coughed up $5 billion if he didn’t think he would reap a handsome profit when the dust has settled.
Messrs. Li Ka-shing and Buffett did not get to be among the richest men in the world without learning that altruism can pay dividends.