China Construction Bank to raise money in rights issue

0 CommentsPrint E-mail Xinhua, November 2, 2010
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China Construction Bank (CCB), China's second largest lender by assets, said Tuesday it plans to raise 61.62 billion yuan (9.21 billion U.S. dollars) in a dual rights issue in Shanghai and Hong Kong to improve its capital base.

In statements filed with the Shanghai and Hong Kong stock exchanges, the dual-listed CCB said it will sell 0.7 shares for every 10 existing shares from Nov. 5 to Nov. 11.

The rights issue's new shares are priced at 3.77 yuan per share for A-share shareholders in Shanghai, a 27 percent discount from Monday's closing price.

The rights issue's new shares are priced at 4.38 HK dollars per share for H-share investors in Hong Kong, a 42.7 percent discount from Monday's closing price.

CCB said the rights issue will replenish its capital base and further improve the bank's capital adequacy ratio.

In Tuesday morning trade, the CCB share price dipped less than 0.5 percent to 5.14 yuan in Shanghai and rose nearly 1 percent to 7.71 HK dollars in Hong Kong.

Chinese banks are planning to boost their capital bases after China's central bank moved last month to tighten market liquidity with a 0.25 percent interest rate hike.

Bank of China (BOC), China's fourth-largest lender by assets, said Friday it will raise up to 60 billion yuan (8.97 billion U.S. dollars) in a dual rights issue in Shanghai and Hong Kong to replenish its capital base.

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