SHANGHAI, March 1 (Reuters) - China’s Industrial Bank Co Ltd aims to raise at least 25 billion yuan ($3.97 billion) selling shares to institutional investors including the People’s Insurance Co (Group) of China Ltd (PICC) and China Tobacco, the 21st Century Business Herald reported on Thursday, citing unidentified sources.
Industrial Bank aimed to raise 25-26 billion yuan through the private share placement, and PICC would take up 70 percent of the offering as a strategic investor, the newspaper reported.
It said Industrial Bank had selected PICC because the lender was seeking to enter the insurance business and expected the cooperation to bring synergy and cross-selling opportunities, the newspaper said, adding that BOC International (China) Ltd was underwriter for the share sale.
Chinese banks have been replenishing capital in recent years amid rapid loan expansion and tighter capital requirements by regulators. The move is also part of a trend towards financial integration in which banks and insurers invest in each other’s segments.
Industrial Bank, 12.8 percent owned by Hong Kong’s Hang Seng Bank Ltd, said on Wednesday that it was planning to introduce strategic investors, and that its shares would be suspended from trading pending an announcement. ($1 = 6.2936 Chinese yuan) (Reporting by Samuel Shen and Gabriel Wildau; Editing by Chris Lewis)