ABC Goes Public

(LU XIAOWEI)

The Agricultural Bank of China Ltd. (ABC) in mid-July successfully launched its initial public offering (IPO) in dual listings in Shanghai and Hong Kong, to replenish its capital and fuel expansion. The IPO raised a total of $22.1 billion, the largest in the world.

The bank sold 25.57 billion A-shares on the Shanghai Stock Exchange at 2.68 yuan ($0.4) per share and up to 25.4 billion shares in Hong Kong at HK$3.2 ($0.41) per share, excluding an over-allotment option.

ABC shares on the Shanghai and Hong Kong bourses increased a miniscule 0.75 percent on July 15 and 2.2 percent on July 16, the first days of their respective IPOs.

ABC was the last of China's "big four" state-owned commercial banks to sell shares to the public and its listing marked the end of the banking sector reform that started in 2005.

The bank owns more than 24,000 branches nationwide with more than 350 million customers. Though the second biggest in terms of assets among the "big four," it has always been the weakest link among China's state-owned commercial banks.

From January to September, the bank generated a profit of 70.2 billion yuan ($10.5 billion) in the first three quarters, a growth of 36.3 percent from one year earlier. The bank attributed the buoyant performance to expanding interest income and soaring intermediary businesses.