City commercial bank aims to raise US$500m from share offering
Bank of Shanghai, which is 9.9 per cent owned by HSBC, plans to raise US$500 million from an initial public offering in Hong Kong next year, joining a string of small banks following larger state-owned lenders to get a listing in the city, according to sources.
Bank of Beijing, partly owned by Dutch investment bank ING, is looking to raise US$500 million next year, when Citic Bank and China Everbright Banks plan to sell shares.
'International investors [are interested in] China-related investment and city commercial banks are in a better position to raise shares, compared with banks like Agriculture Bank of China and China Everbright,' said Core Pacific Yamaichi analyst Kent Yau.
Bank of Shanghai could not be reached for comment.
The country's 113 city commercial banks, which on average run between 40 and 60 branches, are thought to be easier to manage and more likely to be free of credit troubles than their larger counterparts. Some have also brought in foreign investors to strengthen their credit quality by introducing international best practices.
Even so, the city lenders are not immune from problems. A Bank of Shanghai branch manager was sentenced last week to nine years in prison for embezzling 110 million yuan of the bank's capital.
