China’s ICBC to acquire approximately 10.82% stake in Bank of Jinzhou
Author : Sunil Hebbalkar | Published Date : 2019-07-29
- An investment of up to 3 billion Yuan ($436 million) would be done by the ICBC Financial Asset Investment Co. to acquire the 10.82% stake.
- The proposed deal would be carried out through ICBC’s own funds.
The Industrial and Commercial Bank of China (ICBC), China’s biggest lender on the basis of assets, reportedly announced that one of its units has engaged in an equity transfer deal to make an investment in the Bank of Jinzhou, which is currently going through troubled waters.
Reports cite, this investment was done under the country’s latest bid supported by the state to help smaller banks which are highly indebted to contain financial risks.
In a statement given to Shanghai Stock Exchange, the state-owned bank stated that ICBC Financial Asset Investment co., one of its units, would make an investment of over 3 billion Yuan ($436 million, approximately) in a stake of about 10.82% in Bank of Jinzhou.
Concerns have been increasing about the Bank of Jinzhou ever since the lender from Hong Kong suspended trading in its own shares in 2019 in Hong Kong and saw an auditor quit. Bank of Jinzhou recently stated that it was conducting discussions with various organizations for possible investments.
ICBC reportedly released a statement that claimed, the investment was to provide supply side reform in the country’s financial sector and improve the bank’s ability to cater to the real economy. The statement further added, this deal would take place with own funds of ICBC.
Recently, a government-driven takeover of Baoshang Bank, a little known bank, reignited concern of the health of several small lenders in a slowing economy that is resulting in increasing problems of loans, draining their reserves and testing their wealth buffers.
According to reliable sources, regulators have recently met various financial organizations to talk about measures to address the liquidity issues at the bank.
Source Credit: https://www.thestar.com.my/business/business-news/2019/07/28/chinas-icbc-to-take-nearly-11pct-stake-in-bank-of-jinzhou/
About Author
Sunil Hebbalkar
Sunil Hebbalkar currently works as a content writer for fractovia.org and other portals. A post graduate in mechanical design engineering, he nurtures a passion for writing articles related to myriad industry verticals such as the technology, automotive, and healthcare sectors. When free, Sunil pursues his interest in cycling, reading, and sketching. He can be contacted at- [email protected] | https://twitter.com/HSuniel
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