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State banks not sold cheaply -regulator
(Xinhua)
Updated: 2005-12-05 14:34
China's chief banking regulator said Monday the country did not sell too cheaply its state banks through stock market listings on the back of stringent requirement for foreign investors.
Liu Mingkang |
Chairman Liu Mingkang of the China Banking Regulatory Commission (CBRC) said foreign strategic investors are asked to hold a minimum of a 5 percent stake at a Chinese bank, and are not allowed to sell that holding in three years.
Strategic investors are required to send directors to the Chinese banks to help decision-making and encouraged to bring in senior managers, Liu told the press conference held by the Information Office of the State Council.
He said the investors should boast sophisticated banking experience and technologies, as well as sound wishes to cooperate with Chinese banks.
Meanwhile, the CBRC stipulates a single foreign financial institution should invest in no more than two Chinese banks, which Liu said is aimed at "avoiding interest conflicts and market monopoly."
These criteria for foreign investors mean that they actually have very limited chances for speculative profits, he said. "They have to exert their own efforts so as to achieve long-term cooperation and win-win results with Chinese banks."
The Oct. 27 listing of China Construction Bank in Hong Kong -- the first by a Chinese state bank -- has led to allegations that its initial public offering price was too low, which Liu Mingkang also denied.
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