China Central Huijin Investment Ltd, the domestic investment arm of the nation's sovereign wealth fund, China Investment Corp, is expected to earn over 70 billion yuan in dividends from the nation's big three lenders in 2009, Shanghai Securities News reported Tuesday.
As the parent of the country's three big lenders, Industrial and Commercial Bank of China, China Construction Bank and Bank of China, Central Huijin gained 68.3 billion yuan and 59.5 billion yuan in 2008 and 2007 from these banks, respectively.
The record-high dividends were connected with better performance of the big three lenders. They saw total net profits of 317 billion yuan in 2009, up 18 percent year-on-year, according to their annual reports.
Central Huijin will receive dividends of 20 billion yuan through its 35-percent stake in Industrial and Commercial Bank of China, 24 billion yuan through its 68-percent stake in Bank of China and 26.9 billion yuan through its 57-percent stake in China Construction Bank, the report said.
Earlier in the month, Bank of China gained shareholders' approval to issue up to 20 percent of its existing shares and as much as 40 billion yuan of six-year convertible bonds in Shanghai. Industrial and Commercial Bank of China announced it will issue up to 25 billion yuan worth of convertible bonds. China Construction Bank is also studying a refinancing plan.
Central Huijin was seeking a capital injection of $50 billion from the government, in an effort to boost its capital base and prepare itself for the impending public offering of Chinese lenders, according to earlier media reports.