Home>News Center>China

Temasek to buy 5% of Bank of China - report
Updated: 2005-12-26 12:56

Singapore's state-run investment agency Temasek Holdings has won approval from China's central bank to buy a 5 percent stake in Bank of China, half what it had sought, the Caijing business magazine said in its latest edition published on Monday.
Temasek agreed in September to buy 10 percent of China's third-largest lender but the bank's biggest shareholder, Central Huijin Investment Co., blocked the deal amid concerns Beijing has been selling off chunks of its banks to foreigners too cheaply.

"Temasek's investment in Bank of China has won approval, but the size of the investment has been reduced to 5 percent from the original 10 percent," the Caijing said, citing unnamed government sources.

Under the approved plan, Temasek would buy 5 percent in new shares from Bank of China, scrapping its earlier bid to buy another 5 percent from Central Huijin, the central bank's investment agency that manages foreign currency funds injected into the nation's big state banks.

"Bank of China will implement its stock listing plan at the fastest possible speed after getting the investment," the magazine said.

Bank of China plans to list its shares overseas next year.

The bank had already won approval to sell a 10 percent stake to a consortium led by Royal Bank of Scotland for $3.1 billion. The other strategic investors are UBS and Manila-based Asian Development Bank.

China's national welfare fund had been given the green light to invest 10 billion yuan in each of the country's two largest commercial banks -- Industrial and Commercial Bank of China and Bank of China, state media have reported.

The welfare fund's investment follows a backlash in China against inroads by foreign institutions into China's banking industry.

Temasek already owns 6 percent of China Construction Bank Corp., the second-biggest bank, and 5 percent of privately owned Minsheng Banking Corp..

Central bank governor Zhou Xiaochuan has recently defended the strategic sales as necessary to bring cash and expertise into an industry saddled with bad loans and poor management practices that are a legacy of decades of politically directed lending.

Banking regulator Liu Mingkang has also rejected charges that Beijing was selling off stakes too cheaply or giving foreign banks too much influence over the economy.

Harbin Ice & Snow World
Two-year old mother and its 13 doggy babies
Bar fire leaves 26 dead, 11 wounded in Guangdong
  Today's Top News     Top China News

US$35.8 billion of funds abused this year



China and Japan discuss UN reform



Drug to treat human case of bird flu developed



Family of three die in suspected suicide blast



Law to curb gov't power over house relocation



China to build two new nuclear plants


  Accident cash funds set up by coal mines
  Family of three die in suspected suicide blast
  US$35.8 billion of funds abused this year
  China to build two new nuclear plants
  Yangtze Delta leaders seek closer links
  China and Japan discuss UN reform
  Go to Another Section  
  Story Tools  
  Related Stories  
Bank of China, Construction Bank eye insurance
Bank of China targets IPO in 1st quarter
Executive: BOC targets IPO in 1st qtr of 2006
China seeks foreign investors in banks
  News Talk  
  It is time to prepare for Beijing - 2008  
Manufacturers, Exporters, Wholesalers - Global trade starts here.