International Business Machines, the world's largest information technology services provider, plans to join a Citigroup-led group and buy 5 per cent of Guangdong Development Bank (GDB), sources close to the deal said. IBM will join the consortium led by Citigroup, the world's largest financial services provider, in the 24.1 billion yuan bid to buy a controlling stake of the troubled Guangdong lender, the sources said. 'IBM has been involved for some time and it's just finally got out into the public domain,' one of the sources said. The Citigroup-led group is competing with bids led by French investment bank Societe Generale and state insurer Ping An Insurance. Sources earlier said that the Citigroup consortium had won approval from the State Council. However, no final agreement has been signed and talks on the details are continuing. Societe Generale argues that it still has an outside chance of winning with a lower 23.5 billion yuan. IBM declined to comment while Guangdong Development Bank could not be reached for comment. 'It is strange for IBM, a technology company to buy a Chinese bank,' said a person working for a global consulting firm on Chinese banking industry. He said it does not make sense for IBM, which has not bought any financial assets in China, to get involved in the deal. IBM's participation may also add uncertainty to the deal given that it is not a financial institution, he added. When the China Banking Regulatory Commission rules published in 2003 on foreign financial institutions buying domestic banks, they are defined as public development finance corporates such as International Finance Corp as well as foreign financial groups, banks, securities firms, insurers, fund management firms and other financial institutions recognised by the commission. However, a source close to the Citigroup consortium said he had not seen the regulation was an issue with IBM's proposed investment. Under CBRC rules, a single foreign financial institution can take up to only 20 per cent of a Chinese bank. However, a domestic lender may sell up to a combined 25 per cent stake to more than one foreign investor. Citigroup, which seeks a 20 per cent stake in Guangdong Development Bank on its own, has not officially announced the members of its consortium bidding for the lender's 85 per cent stake. Its mainland partners include China Life Insurance, the country's biggest insurer and State Grid Corp, sources said. China National Cereals, Oils & Foodstuffs has dropped out of the group while Citigroup is looking for another passive investor after the mainland regulator opposed its subsidiary Associates First Capital a member of the consortium, according to various media reports.