BOC plans to raise US$8.9b in share issue
Source: Agencies/Shanghai Daily |
July 3, 2010, Saturday
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Print Edition
Print Edition
THE Bank of China Ltd yesterday announced it will raise up to 60 billion yuan (US$8.9 billion) in a new effort by a major Chinese state-owned lender to replenish capital following last year's lending boom.
BOC shareholders can buy 1.1 shares for each share they own "to improve the capital adequacy ratio of the bank," the bank said in a statement. It said the new shares will be issued on exchanges in Shanghai and Hong Kong.
China's banks are raising billions of dollars from investors under orders from regulators to shore up their balance sheets after they lent a record 9.6 trillion yuan in 2009 in support of the country's stimulus.
The BOC's capital adequacy ratio was 11.09 percent at the end of March, below the minimum 11.5 percent required by the China Banking Regulatory Commission.
The Beijing-based lender said its plan requires shareholder approval but such permission is largely a formality because some 67.5 percent of its shares are owned by Central Huijin Investment Co, an arm of China's sovereign wealth fund.
The BOC also raised money from investors in June with a bond issue.
The bank's yuan-backed A-share offering comes when the benchmark Shanghai Composite Index has lost more than 27 percent so far this year to rank as the worst performer among the world's top 10 markets and also just as the Agricultural Bank of China is rolling out its initial public offering via a dual-listing in Shanghai and Hong Kong to raise US$23.1 billion which could rank as the world's biggest IPO ever.
BOC shareholders can buy 1.1 shares for each share they own "to improve the capital adequacy ratio of the bank," the bank said in a statement. It said the new shares will be issued on exchanges in Shanghai and Hong Kong.
China's banks are raising billions of dollars from investors under orders from regulators to shore up their balance sheets after they lent a record 9.6 trillion yuan in 2009 in support of the country's stimulus.
The BOC's capital adequacy ratio was 11.09 percent at the end of March, below the minimum 11.5 percent required by the China Banking Regulatory Commission.
The Beijing-based lender said its plan requires shareholder approval but such permission is largely a formality because some 67.5 percent of its shares are owned by Central Huijin Investment Co, an arm of China's sovereign wealth fund.
The BOC also raised money from investors in June with a bond issue.
The bank's yuan-backed A-share offering comes when the benchmark Shanghai Composite Index has lost more than 27 percent so far this year to rank as the worst performer among the world's top 10 markets and also just as the Agricultural Bank of China is rolling out its initial public offering via a dual-listing in Shanghai and Hong Kong to raise US$23.1 billion which could rank as the world's biggest IPO ever.
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