Bank of America, the third-largest US banking group, is to invest US$2.5 billion to buy shares of the China Construction Bank (CCB), according to an agreement finalized between the two banks Friday.

As a strategic investor in the CCB, Bank of America also has the option to increase its stake in the CCB to 19.9 percent, according to the agreement.

The deal is so far the largest one-batch investment by an overseas company in a Chinese company.

Bank of America uses the US$2.5 billion to buy CCB shares now owned by the Central Huijin Investment Co. Ltd., a state-owned investment company established in 2003.

When the CCB launches its IPO in the future, Bank of America will purchase US$500 million -worth of CCB's securities.

CCB is one of the four major state-owned commercial banks and one of the two pilot banks in China's aggressive financial reform.

(Xinhua News Agency June 17, 2005)