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BNP to take 19.2% of Nanjing lender
(Shenzhen Daily/Agencies)
Updated: 2005-10-13 09:27
BNP Paribas, the second-largest commercial bank in the euro zone, said Wednesday it had signed a deal to buy 19.2 percent of Nanjing City Commercial Bank (NCCB) for 704 million yuan (US$87 million).
The deal, which requires regulatory approval and is expected to be finalized by year-end, makes BNP the second-largest shareholder in the Chinese lender, behind the Nanjing Municipal Government.
It marks BNP’s first investment in the Chinese banking industry, as rivals ranging from HSBC Holdings Plc. to Deutsche Bank expand in the country to stake a claim to some of the country’s US$1.5 trillion in personal savings.
“BNPP is to acquire from several shareholders a 19.2 percent shareholding in NCCB at a price of 704 million yuan. BNPP will therefore become the second-largest shareholder in NCCB,” the French lender said.
Of the 19.2 percent stake, 10 percentage points would come from the World Bank’s private sector arm, the International Finance Corp., BNP said. IFC would retain a 5 percent stake in the Chinese bank after the deal.
Nanjing bank said BNP would pay 3.04 yuan a share for the stake, the result of more than a year of talks.
BNP now has a securities venture and runs a corporate banking operation in Shanghai. It also maintains an asset management venture on the mainland.
As part of the deal, Nanjing bank said it would cooperate on consumer finance with Cetelem, a BNP unit that specializes in the area. Cetelem is also a major issue of bankcards in Europe.
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