Chinese bank sees limited impact from more IPOs
BEIJING, Apr 17 (Reuters) China Construction Bank Corp., which floated shares in Hong Kong last year, sees only limited impact from the planned listings of more mainland lenders in the territory, its chairman said in remarks published on Monday.
Asked by Lifeweek magazine if he was worried about the impact that planned listings in Hong Kong by Bank of China and Industrial and Commercial Bank of China might have on his bank's share price, Guo Shuqing said: ''The listings in Hong Kong of Bank of China and ICBC could have some impact on CCB's share price, but I believe that the impact will not be big,'' he told the magazine in an interview.
''We welcome the fact that other Chinese banks are seeking to list shares abroad, every bank has its own strength,'' he said.
China Construction Bank Corp., one of the country's largest state-controlled banks, raised .2 billion in a record Chinese initial public offering last year.
Bank of China, the nation's top foreign exchange lender, and Industrial and Commercial Bank of China are due to float shares in the former British colony of Hong Kong in 2006.
Guo shrugged off rising competition in the banking sector, which has been attracting foreign investment, saying there was much scope for lenders to grow in a market that remained backward and beset with low standards.
He was also asked about the significance of recent moves by the bank to sign cooperation agreements with provincial governments and how such practices might differ from politically inspired lending practices of the past.
Guo said such agreements had nothing to do with taking political orders to extend loans, a practice which has saddled the nation with hundreds of billions of dollars worth of sour loans in recent decades. He said loans to big provincial projects were assessed according to their commercial value.
Analysts say Chinese lenders spearheading financial sector reforms have been trying to make market-based lending decisions but there was some way to go.
REUTERS PV HT1642