UOB Annual Report 2002 - United Overseas Bank

32 Investments in Subsidiaries
(a)
The Bank
2002 2001
$'000
$'000
Quoted equity shares, at cost 18,393 395,694
Unquoted equity shares, at cost 1,733,754 10,050,640
Provision for diminution in value [Note 33(b)] (342,318) (185,736)
1,391,436 9,864,904
Total investments in subsidiaries 1,409,829 10,260,598
Market value of quoted equity shares at 31 December 70,967 745,559
The subsidiaries of the Group as at the balance sheet date are set out in Note 46 to the financial statements.
(b) On 2 January 2002, OUB, a wholly-owned subsidiary, was merged into the Bank under Section 14A of the Banking Act, Cap. 19.
As a result of the merger, the businesses, assets, liabilities, interests, rights, privileges, obligations and commitments of OUB
were transferred to and vested in the Bank.
The net assets of OUB were partly transferred to the Bank by way of a pre-merger dividend of $692,684,000, representing a
gross dividend of $917,462,000 less tax at 24.5% of $224,778,000. The net dividend of $692,684,000 has been credited to the
Bank’s cost of investment in OUB. Arising from the merger, the unamortised goodwill of the Group in respect of OUB as at
2 January 2002 amounting to $3,776,651,000 was transferred to the Bank at net book value.
The fair values of identifiable assets, liabilities and off-balance sheet items as at 2 January 2002 transferred to the Bank were
$36,058 million, $31,367 million and $27,135 million respectively.
The surplus arising from the merger of $145,482,000 represents the excess of the fair values of identifiable net assets of OUB
and the unamortised goodwill of the Group in respect of OUB as at 2 January 2002 over the carrying amount of the Bank’s
investment in OUB. The surplus has been recognised in the Bank’s income statement (Note 13) with no financial effect on the
consolidated income statement.
UNITED OVERSEAS BANK 131