Citigroup not approved to buy Chinese bank
(AP)Updated: 2006-11-02 16:09
China's banking regulator on Thursday denied a report that Citigroup Inc has
won approval to buy control of a Chinese bank in a US$3 billion (euro2.2
billion) deal.
No bid for the Guangdong Development Bank has been
approved by regulators, said Liu Mingkang, chairman of the China Banking
Regulatory Commission. He was speaking to reporters at a banking conference in
Beijing.
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"It's false. It's misleading," Liu said of the report. "We haven't gotten any application" for the sale of Guangdong Development Bank.
Chinese banks have sought out international lenders as strategic investors to get both money and management skills as Beijing gradually opened the industry to foreign competition.
Bidding for the Guangdong bank has been unusually heated because a takeover would offer the rare opportunity for a foreign investor to win management control of a mid-size Chinese bank.
Earlier reports said Citigroup was seeking 40 percent of Guangdong Development Bank as part of a consortium that would buy 85 percent of the bank. Societe Generale and Ping An Group were making a similar offer.
It wasn't clear how those bids would deal with government rules that limit total foreign investment in a Chinese bank to 25 percent and any single foreign investor to a 20 percent stake.
Vice President Wang Xin of Guangdong Development Bank also questioned the validity of the report.
"Is that true? We haven't signed any deal yet and we also have not been
informed by the China Banking Regulatory Commission yet," he said
on Wednesday.
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