|
||||||||
  |
||||||||
|
||||||||
|
||||||||
|
||||||||
|
||||||||
|
|
|||||||||||||||||||||||||||||||||||||||||||||
Citibank taking Shanghai bank stake
By Alex Frew McMillan
HONG KONG, China (CNN) -- Citibank will become a strategic investor in Shanghai's Pudong Development Bank Co., the Chinese bank said Tuesday. "Our company has received a notice from relevant government departments permitting Citibank of the United States to be our strategic investor," Pudong Bank said in a statement. The mid-size bank, one of only four that trade publicly in China, said the move would make it more competitive and help it with its internationalization. Pudong Bank declined to say how much Citibank would invest, saying only that more details would come out over the next few days. Preparing for overseas competitionReports earlier this year stated Citibank was in talks to buy the 8.3 percent stake in Pudong Bank owned by the company's largest shareholder, the city government's Shanghai State Asset Management Co. China's banks are preparing to compete with international institutions as China opens up the financial industry under World Trade Organization rules. Overseas banks will start being able to do business with Chinese customers in yuan in 2007. By some estimates, more than half of all China's bank loans are bad, and many institutions have been looking for overseas backing and management expertise to bolster their positions. Overseas deals increasingHSBC became one of the first overseas banks to buy into a Chinese bank when it took an 8 percent stake in the Bank of Shanghai last year. It is also in talks with Guangzhou City Commercial Bank about buying a stake. Shenzhen Development Bank is in the process of selling almost 20 percent of itself to U.S. buyout fund Newbridge Capital Group. Government companies own 65 percent of Pudong Bank, which also said Tuesday that it will reduce a planned secondary offering on China's A share market to 3 billion yuan, instead of the 5 billion yuan initially announced. Pudong Bank stock is down 1.96 percent at 9.48 yuan on Tuesday, having been suspended for an hour during the announcement. The news of the buyin is driving other bank stocks higher, though, leading to a 0.28 percent gain in Shanghai A shares and a 0.71 percent climb in Shanghai's B share listings.
|
|
|||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||
