Bank of America sells China bank stake for $7.3b
Friday, 15 May 2009
NEW YORK, May 14 (AFP): Bank of America confirmed Wednesday that it had sold a third of its stake in China Construction Bank Corp (CCB), one of the largest Chinese banks, for 7.3 billion dollars.
"We did this as part of our plan to raise capital," bank spokesman Robert Stickler told the agency.
Under pressure from US regulators to raise capital, the bank "sold approximately 13.5 billion shares of CCB in a private transaction" to a consortium led by China's Hopu Investment Management, he said.
Among others in the consortium are Singapore's Temasek Holdings and China Life Insurance.
The stake was the maximum amount Bank of America could sell after a lock-up agreement expired last week. That amount, about a third of the bank's stake, amounted to 16.7 per cent of CCB.
The sale came after the release of "stress tests" by US federal regulators last week that showed the US lender needed 33.9 billion dollars in core capital as a buffer in the event of a weaker economy.
"We did this as part of our plan to raise capital," bank spokesman Robert Stickler told the agency.
Under pressure from US regulators to raise capital, the bank "sold approximately 13.5 billion shares of CCB in a private transaction" to a consortium led by China's Hopu Investment Management, he said.
Among others in the consortium are Singapore's Temasek Holdings and China Life Insurance.
The stake was the maximum amount Bank of America could sell after a lock-up agreement expired last week. That amount, about a third of the bank's stake, amounted to 16.7 per cent of CCB.
The sale came after the release of "stress tests" by US federal regulators last week that showed the US lender needed 33.9 billion dollars in core capital as a buffer in the event of a weaker economy.