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BOC may raise 50b yuan through H-share issuance

By Cai Muyuan (chinadaily.com.cn)
Updated: 2010-02-25 16:52

Bank of China (BOC) is about to issue H shares to raise 50 billion yuan, the National Business Daily reported on Thursday.

According to the report, the bank has asked its investment bank to submit a fund raising plan for the second half of the year.

Luo Nan, the bank's head of investor relations, said the bank has a plan on H-share financing, but it needs to be passed by the shareholders' general meeting on March 19 and go through the supervisory board.

Chinese banks extended some 9.6 trillion yuan in new loans last year. Chinese banks plans to re-finance over 100 billion yuan in 2010 on the stock market, the newspaper reported.

The market has been closely watching banks' massive fund raising plans since late last year, as investors are concerned that hefty offerings could upset the stock market.

But Zhang Jing, an analyst with China Minzu Securities, said the market will not be affected much by the offering, as investors were aware of the news for a while and got prepared.

"A rights issue is good for the banks' business expansion and capital adequacy ratio. It will win over the support of strategic investors," Zhang said.