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Chinese Mandarin - State banks to go public soon

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State banks to go public soon

www.chinanews.cn 2005-03-07 16:23:28

(Source: Xinhuanet)

BEIJING, March 7 - Governor Zhou Xiaochuan of the People's Bank of China,
or the country's central bank, revealed here Sunday that the planned
share-offerings and listings of state-owned Bank of China (BOC) and China
Construction Bank (CCB) are "not too far away".
The banks' stock market debuts should be decided by their boardof
directors and depend on whether there are "windows of opportunity" on the
capital market, he told a press conference during the annual session of
the National People's Congress (NPC).
The banks were also consulting overseas and domestic investmentbanks,
their financial advisers and accounting firms regarding thetiming, Zhou
added.
Both the BOC and CCB have completed financial reshuffle and need to
strengthen corporate governance and push on some internal reforms, he
said.
The BOC and CCB, considered as financially healthier banks among China's
Big Four that also include the Industrial and Commercial Bank of China
(ICBC) and Agricultural Bank of China (ABC), are leading the government's
latest, aggressive reform in the vital financial system.
They received a combined 45 billion US dollars in foreign exchange
reserves at the end of 2003 from the central government aiming to bolster
their balance sheets.
The bailout package has helped the BOC and CCB raise their capital
adequacy ratios (CARs), being a measure of their available capital in
proportion to their outstanding loans, to 8.62 and 11.95 percent,
respectively, by the end of 2004.
The BOC's and CCB's non-performing loan (NPL) ratios plunged to5.12 and
3.7 percent, respectively, by the end of last year, according to a report
delivered at the press conference.
The banks have both become joint-stock firms with a governance structure
featured by a shareholders' meeting, board of directors,board of
supervisors and senior management, which have all startedoperation.
The BOC has done away with all government ranks of its staff, urging its
230,000-strong employees to vie for new jobs in the bank.
A new company, the Central Huijin Investment Co., was inaugurated as
major shareholders of the two banks to supervise their restructuring. It
is managed by former department heads of the People's Bank of China with
a board comprising representativesfrom the State Administration of
Foreign Exchange, Ministry of Finance and the central bank.
On Monday, Zhou Xiaochuan also revealed reform of the other twobig state
banks -- the ICBC and ABC -- "will also advance in a similar direction".
"We should say that joint-stock reform of the ICBC and ABC willbe carried
forward on the back of progress and experience achievedon the BOC and
CCB."
He gave no details about whether the state would also inject hefty funds
into the ICBC and ABC. "Different banks will be given different
policies," he said.

E-mail: zhangqinghua@chinanews.com.cn Tel: 8610-88387443 Fax:
8610-68327649

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