IPOs set trend for listing by city banks
Updated: 2007-07-12 14:16
The initial public offering of two lenders - Bank of Nanjing and Bank of Ningbo - this week will spur a new round of bank listings on the domestic stock markets.
The major players in this listing rush will be qualified city commercial banks as most State-owned and joint-stock banks have already gone public.
Bank of Nanjing, partly owned by top French lender BNP Paribas, plans to sell up to 700 million A shares, or 36.72 percent of its enlarged capital after the initial public offering (IPO), for a listing on the Shanghai stock market.
Bank of Ningbo, partly owned by Singapore's Oversea-Chinese Banking Corp, will issue 450 million A shares, or 18 percent of its enlarged capital, for a listing on the small and medium-sized enterprises (SME) board of the Shenzhen stock market.
Apart from the two banks, Bank of Beijing has also completed its application for a simultaneous IPO in Hong Kong and Shanghai.
A few other city commercial lenders with overseas strategic investors, including those in Hangzhou, Chongqing and Shanghai, are next in line.
These lenders, the top ones among the country's 114 city commercial banks, are comparable to their bigger counterparts regarding business performance and asset quality.
Statistics from the China Banking Regulatory Commission shows the average non-performing loan (NPL) ratio of city commercial banks stood at 4.8 percent at the end of 2006, against an average of 7.51 percent for big State banks.
By the end of 2006, total assets of China's 114 city commercial banks were 2.6 trillion yuan, or 6 percent of the country's total banking assets of 44 trillion yuan.
Bank of Nanjing, with 58 branches in Jiangsu Province, reported gross assets worth 57.9 billion yuan and net profits of 595 million yuan in 2006. Its NPL rate was 2.47 percent.
With 68 branches in Zhejiang Province, Bank of Ningbo had 56.6 billion yuan in total assets, with a NPL rate of only 0.33 percent last year.
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