Bid target Wing Lung's Q1 interest income falls 1.4 pct

HONG KONG, May 17 (Reuters) - Wing Lung Bank Ltd (0096.HK: Quote, Profile, Research, Stock Buzz), which is awaiting final bids in a takeover battle, said its net interest income for the first quarter of 2008 fell 1.4 percent to HK$360.1 million ($46.2 million) from a year ago.

Net fees and commission income for the first quarter rose 2.9 percent year-on-year to HK$90.9 million while operating income of its insurance operations rose 2.6 percent to HK$108.9 million, the bank said in a statement late on Friday.

It wrote down investments in structured investment vehicles (SIV) by about HK$284.4 million and collateralized debt obligations (CDO) by about HK$192.3 million. The net carrying value of its remaining SIV and CDO portfolios stood at about HK$566.6 million as at end-March.

For full statement please see here 0516335.pdf Final bids for a controlling stake in Wing Lung are expected to be submitted by end of the month at the latest, with analysts previously saying the deal for the small lender could be worth around $4.8 billion.

Sources close to the matter told Reuters on Friday that ICBC (1398.HK: Quote, Profile, Research, Stock Buzz) (601398.SS: Quote, Profile, Research, Stock Buzz), the world's biggest bank by market value, is the strongest contender. Australia and New Zealand Banking Group Ltd (ANZ) (ANZ.AX: Quote, Profile, Research, Stock Buzz), Australia's third-biggest lender, is also keen to take a stake in Wing Lung.

Shares of Wing Lung, which hit an all time high of HK$155 on Friday, have soared 62 percent so far this year. (US$1=HK$7.8) (Reporting by Donny Kwok; Editing by Anshuman Daga)