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Huaxia Bank gets board approval for $3b placement

(chinadaily.com.cn)
Updated: 2010-06-01 17:45

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Huaxia Bank Co, which is partly owned by Deutsche Bank AG, got board approval to raise up to 20.8 billion yuan ($3.04 billion) through private placement, the lender said in a statement Monday.

The bank announced a private placement plan on May 5 to issue 1.86 billion A-shares at 11.17 yuan per share in order to boost its capital base.

Shougang Group, China's eighth-largest steel maker, will buy 691 million shares, and its stake in the bank will rise to 20.28 percent. Shougang will remain the largest shareholder of Huaxia Bank after the transaction.

The bank will also sell 653 million shares to a unit of State Grid Corp, and 514 million shares to Deutsche Bank Luxembourg SA. The stakes held by the two companies will rise to 18.24 percent and 19.99 percent, respectively.

The capital adequacy ratio (CAR) of Huaxia Bank was 10.83 percent and core CAR was 6.6 percent at end of the first quarter in 2010. Analysts believe the above two ratios will rise to......

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