AGRICULTURAL Bank (AgBank) of China, gearing up for a likely record $23bn (£15.5bn) IPO, looks set to tap Britain’s Standard Chartered as a cornerstone investor.
AgBank signed a strategic deal with emerging markets-focused Standard Chartered yesterday to collaborate on banking products and services, both in China and internationally.
“It’s very likely StanChart will take a cornerstone stake in AgBank,” said Alex Wong, director of asset management at Ample Finance. “There’s a very good synergy. StanChart would bring the management efficiency to the partnership.”
Standard Chartered is the second European bank after Netherlands-based RaboBank to sign a strategic alliance with AgBank.
A RaboBank spokesman said it could take a stake in AgBank worth between $100m and $200m to seal an alliance with the lender, China’s third-largest, with assets of $1.4 trillion.
“The partnership will focus on the increasingly strong intra-Asia and Asia-Africa trade corridors... while also looking at joint opportunities across AgBank’s and Standard Chartered’s domestic Chinese market operations,” the British bank said.
AgBank also said it would soon nearly halve the amount of non-performing loans (NPLs) on its books and keep that level contained.
“NPLs will be contained below 1.5 per cent in a short period of time,” Guo Haoda, a bank vice president, told a roadshow.
City A.M. Reporter