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Bank of Ningbo applies to issue shares

(Shanghai Daily)
Updated: 2007-05-25 14:16
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The Bank of Ningbo has applied to issue up to 450 million new yuan-backed shares as the city's commercial lender steps up its efforts to raise capital.

The bank is now awaiting regulatory approval from China Securities Regulatory Commission on its application for the new share listing, said a source close to the deal. The bank has hired Goldman Gao Hua Securities to arrange the share sale.

It is unknown how much the lender rake-in through an initial public offering.

The bank, formerly known as Ningbo Commercial Bank, is among China's 110-plus city level commercial banks seeking to expand through a three-step strategy -- wooing strategic investors, expanding outside its city territory and going public in the long haul.

The lender has already made its first two steps. It sold a 12.2 percent share to Singapore's Overseas-Chinese Banking Corp in 2006. The bank last week stepped out of its headquarters in nearby Zhejiang Province by opening a branch in Shanghai last Friday. It was also the first out-of-town city commercial lender to make a foray into Shanghai.

The bank based in the eastern Chinese port city of Ningbo had 60.54 billion yuan (US$7.87 billion) in assets at the end of March and 30.1 billion yuan in outstanding loans.

Its capital adequacy ratio was 11.25 percent, compared with the minimum regulatory requirement of eight percent. Its bad-loan ratio was 0.36 percent at the end of March.
The bank has a strong foothold in small and medium sized banking. It had 3,778 SME clients at the end of 2006, accounting for 94.8 percent of its total corporate client pool. Its SME loans made up 92.9 percent of its total outstanding loans.

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