Agricultural Bank of China shares surge on record financing plan
BEIJING, March 13 (Xinhua) -- Agricultural Bank of China (ABC) shares surged Tuesday after it announced a plan to raise up to 100 billion yuan (15.8 billion U.S. dollars) in the biggest-ever A-share private placement as the lender moves to replenish capital.
The lender, one of the country's "big four" state-owned banks, will sell up to 27.5 billion shares to seven institutions, including Central Huijin Investment Co., an investment arm of the government, and the Ministry of Finance, and money raised will be used to replenish its core equity tier-one capital, the ABC said in a statement to the Shanghai Stock Exchange.
Its shares rose 2.5 percent to 4.13 yuan in Shanghai and surged 5.4 percent to 4.71 Hong Kong dollars in Hong Kong.
This came as the country's financial regulators planned to expand capital tools for commercial banks to replenish their capital in order to boost their support for the real economy.
A statement posted on the China Banking Regulatory Commission website Monday said the country will improve rules to enable commercial banks to raise funds through multiple channels, including convertible bonds and other loss-absorbing debt instruments.
The country will work on policies to allow institutions such as social security funds, insurance companies, brokerages, and fund companies to invest in the capital tools that commercial banks issued to replenish capital.
In a separate report, the ABC reported that its net profits hit 193.13 billion yuan in 2017, up 4.93 percent year on year, while operating revenue increased 6.13 percent to 537.04 billion yuan.[ Editor: Xueying ]