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CITIC Bank plans to go public

(Xinhua)
Updated: 2007-03-26 09:05

China CITIC Bank, the country's seventh largest commercial bank, plans to go public on both the Chinese mainland and inHong Kongat the end of April this year, raising 2.8 billion to 3 billion U.S. dollars, the Economic Observer reports.

Related readings:  CITIC Bank plans dual listing  CITIC Securities eyes equity investment  CITIC Securities profit up 6 fold  CITIC Securities to make H-share IPO this year

The bank won approval to list on the Hong Kong stock exchange last week and it was waiting for approval by theChina Securities Regulatory Commission(CSRC) to go public on the mainland A-share market. The CSRC will audit the bank application's next week.

According to the plan, the bank will issue eight billion shares, but the share price is yet to be announced.

By listing on the mainland and on the Hong Kong stock markets, the bank aims to strengthen corporate governance in line with international practices and raise more capital.

Analysts believe China's fast economic growth will bring benefits to the bank's development. An agreement was signed between the bank and Spanish banking group Banco Bilbao Vizcay Argentaria (BBVA) at beginning of this year, which is also expected to boost CITIC Bank's business.

BBVA spent 4.885 billion yuan to purchase a 4.83 percent stake in China CITIC Bank.

"Most large-and medium-sized enterprises, especially financial institutions like theIndustrial and Commercial Bank of China, have opted for dual listing as their first choice and the CITIC Bank will not be an exception," Kong Dan, board chairman of theCITIC Group, was quoted as saying in earlier reports.

The bank had 689.5 billion yuan (88.4 billion U.S. dollars) in assets at the end of September last year, with pre-tax profits of 5.7 billion yuan, according to the bank's report for the third quarter last year.

Its capital adequacy ratio (CAR), the measure of its own capital in proportion to its outstanding loans, was 9.18 percent, while its non-performing loan ratio was 2.79 percent.

The previously wholly state-owned CITIC Bank was transformed into a joint-stock company and renamed CITIC Bank Co. Ltd. in December last year. It has more than 400 branches across the country.