Shanghai Pudong Development Bank will scale down its planned share placement by 37.5 per cent amid heightened official opposition to mega-financing deals.
Pudong Bank said in a Shanghai exchange statement last night it would sell not more than 800 million shares, compared with the original plan of one billion shares. The bank did not indicate the fund-raising size, but Reuters said it would be cut to about 25 billion yuan (HK$29.5 billion) from 40 billion yuan.
It said the bank hoped to raise its capital adequacy ratio to 11 per cent from 9.15 per cent at the end of last year after the placement.
The China Securities Regulatory Commission said on Monday that companies should not 'maliciously seize money from the market', a pointed reference to companies planning to top up their capital.
Pudong Bank has won board approval to place as many as one billion shares.
Ping An Insurance (Group) also faces pressure to trim its 120 billion yuan share sale after the securities regulator's warning. Big share placements have been blamed for a slump in the mainland market this year.
At yesterday's A-share price, Pudong Bank is expected to raise about 300 billion yuan. The shares closed at 40.62 yuan, up 0.32 per cent.
