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Bank of China targets Hong Kong IPO in May
(AFP)
Updated: 2006-02-08 13:53
Bank of China, the country's third largest bank, plans to list in Hong Kong
in May and later wants to raise more cash by selling shares on domestic markets.
Bank of China
headquarters in Hong Kong, where the country's third largest bank plans to
list in May and later wants to raise more cash by selling shares on
domestic markets. [AFP] | The lender, one of
China's four major state-owned banks, has filed its dual-listing plan with the
State Council or cabinet and expects the initial public offering of Hong Kong in
May, the China Securities Journal reported.
After the issue of H-shares in Hong Kong, Bank of China will then issue
A-shares on the Shanghai Stock Exchange as soon as possible, the report said,
citing an unnamed source familiar with the matter.
The Hong Kong-based South China Morning Post reported Wednesday that the
authorities may decide what portion of Bank of China's existing shares will be
listed as H-shares this week.
The State Council last month gave in-principle approval to Bank of China's
plan to sell up to 15 percent of its enlarged share capital in the Hong Kong
IPO.
Bank of China has finished pre-listing preparation and can float shares
within 15 months of government approval, although much rides on market
conditions, especially with its domestic portion of the listing, the newspaper
said.
The flotation would follow the successful Hong Kong listings of Bank of
Communications and China Construction Bank last year, the first privatisations
in China's huge and heavily protected banking sector.
China believes privatisation will bring the country's massive and often
ill-governed financial institutions into order before the industry is opened up
to international competition at the end of the year.
However, only recently two former managers for the state-controlled Bank of
China were charged in the United States with stealing more than 485 million
dollars and laundering money through Las Vegas casinos.
China's banking regulator admitted Monday that corruption continues to plague
the sector with some 95 billion dollars in the nation's banking system
identified in 2005 as irregular, 31 percent higher than the previous year.
Scrambling to reassure investors, the Bank of China said this week it would
cooperate with US authorities and was cracking down internally to safeguard bank
assets.
The Beijing-based group has Royal Bank of Scotland, Switzerland's UBS and the
Asian Development Bank as strategic investors, which, according to regulators,
have invested 3.675 billion dollars.
The Singapore government's investment arm, Temasek, could also buy five
percent of Bank of China for 1.5 billion dollars, Chinese press reports have
said.
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