ICBC Listing May Top US$20bn

by Mary Swire, Tax-News.com, Hong Kong

14 July 2006

The mammoth listing of Industrial and Commercial Bank of China, due to take place in October this year, is now expected to raise as much as US$20bn, with simultaneous IPOs in Hong Kong and Shanghai, the official Shanghai Securities News said yesterday.

The Hong Kong (H-share) float will account for about 80% of the amount raised, with the Shanghai (A-share) tranche pulling in the rest. The Chinese authorities are thought to be concerned that too large a capital-raising exercise in Shanghai could depress the market there.

Underwriters to the deal will include Credit Suisse, Deutsche Bank, Merrill Lynch and Morgan Stanley in Hong Kong, while the Shanghai team will include Shenyin & Wanguo Securities, CICC, CITIC Securities Guotai Junan Securities.

ICBC is understood to have been persuaded by the China Securities Regulatory Commission to make the listings simultaneously, and at the same price. The bank is reorganizing its corporate structure in advance of the float to improve risk management, adding ten new departments including risk management, credit approval, asset and liability management, while seven other divisions are cut.

ICBC Chairman Jiang Jianqing said recently that he expects the bank, by stock market value, to become one of the world's top 10 banks, with 2006 business profits exceeding 100 billion yuan (US$12.5bn).

Recommended