China's second-largest lender aims to raise 20 billion yuan in the country's biggest initial public offering
Bank of China, the country's second-largest lender, has priced its A shares at 3.08 yuan each - at the lower end of the indicative price range - in the largest new share offering on the mainland, sources say.
As the bank plans to raise 20 billion yuan, the price means it will sell 6.49 billion A shares. An official announcement of the pricing information is scheduled for today.
'Given BOC just recently sold H shares [in Hong Kong], the A-share offering was priced at a slight premium on the H-share [offer] price,' a source said.
The final price, from a range of between 3.05 and 3.15 yuan, represents 2.85 times BOC's book value at the end of last year and 22 times last year's earnings per share, according to international accounting standards.
BOC attracted a record of more than 120 billion yuan worth of orders from institutional investors in the offering, fund managers said yesterday. That would mean an oversubscription rate of about 19 times as the bank intends to raise about 6.4 billion yuan from institutional investors through the sale of 32 per cent of its mainland shares.