Bank of Beijing, one of the country's biggest city commercial banks, is expected to go public on the Shanghai and Hong Kong stock exchanges simultaneously, according to sources close to the bank.

 

The bank, 19.9 percent owned by International Netherlands Groups, did not provide a fund-raising target for the offer, but people familiar with the deal have said the bank aims to raise about US$8 billion from Hong Kong.

 

The simultaneous initial public offering (IPO) on the two exchanges is expected to take place in the third quarter of 2007, sources said.

 

Bank of Beijing hopes to sell 1 billion shares at around 6 to 8 yuan on the Hong Kong stock exchange, according to the source.

 

According to statistics from the Beijing bureau of China Banking Regulatory Commission, Bank of Beijing's profit hit 2.06 billion in 2006, a 70.8 percent increase from the year before.

 

After handing over its application to China Banking Regulatory Commission on May 31, the bank chose Goldman Sachs to be the IPO underwriter.

 

Sources said Bank of Beijing has improved its corporate governance and raised its standards for managing risky loans.

 

Established in 1995, the bank has aggressively modernized in recent years. It has established branches with good services, and has been praised for its electronic banking service.

 

The bank plans to open its second local bank in Shanghai this September, after opening a branch in Tianjin.

 

The bank is now concentrating on product innovation and network building.

 

Investors, who regard Chinese lenders as proxy investments, have flooded into Chinese bank listings since they began selling shares in Hong Kong in 2005.

 

Bank of Beijing is expected to become the first listed city commercial bank.

 

The bank's listing follows a trend among China's top banks.

 

China CITIC Bank, the country's seventh-biggest commercial bank, raised US$3 billion in April from its simultaneous IPO.

 

Last year, the Industrial and Commercial Bank of China raised US$21.9 billion in its Hong Kong and Shanghai IPOs, the world's largest. China Construction Bank raised US$8 billion when it entered the Hong Kong exchange in October 2005.

 

(China Daily June 22, 2007)