CDB to keep its 3% stake in Barclays

By Zhang Fengming  |   2008-6-27  |     ONLINE EDITION

CHINA Development Bank will keep its stake in Barclays at 3 percent while it also plans to launch its stockholding company before the Olympic Games, the president of the Chinese bank said today.

"We will maintain the 3 percent stake though it's hard to disclose the ultimate target," said Chen Yuan, president of the Beijing-based bank told reporters on the sidelines of the 2008 China Merger and Acquisition Forum in Shanghai today.

Barclays, Britain's fourth-biggest bank, said on June 25 that it will raise 4.5 billion pounds (US$8.9 billion) to bolster capital and expand operations from investors including Singapore's Temasek and China Development.

The Chinese bank bought 3 percent of Barclays in 2007 to support Barclays' bid for ABN Amro.

"The shareholding company will be inaugurated soon and it will be launched before the Olympics this summer," Chen told reporters.

CDB recently received approval from the government to set up a stockholding company, a move that would pave the way for an eventual listing of the bank's shares.
The bank is transforming itself into a market-based commercial lender from a government-directed policy bank. The bank is the biggest policy bank in China.

China Development received a US$20 billion capital injection from the Chinese government in December.

China Development Bank was set up in 1994 and is among China's three policy banks. The other two are China Export and Import Bank and China Agricultural Development Bank. The three were set up to take over government-directed lending functions of the big four state-owned commercial banks.