[SHANGHAI] Industrial & Commercial Bank of China Ltd (ICBC), the world's largest lender by market value, plans to raise as much as 60 billion yuan (S$11.7 billion) from selling debt to comply with new capital requirements.
The board approved a plan to sell so-called Tier-2 securities with a maturity of at least five years by the end of 2014, Beijing-based ICBC said in a statement to the Hong Kong exchange on Tuesday. The debt will include conditions for a forced writedown on the principal, it said.
China's banking regulator, which has delayed and relaxed rules for bolstering its financial stability as economic growth slowed for seven straight quarters, said last month it will require lenders to use new types of debt and equity to raise capital. Regulators globally meanwhile are loosening reserve rules and other measures to avoid choking off interbank lending.
"ICBC is going to be a bellwether in setting the standards for new fundraising tools so that smaller banks can follow," said Sheng Nan, a Hong Kong- based analyst at CCB International Holding Ltd, who rates the stock as outperform. "The bank's current capital level is adequate to support its loan growth for the next two years."
Source: http://www.businesstimes.com.sg/premium/china/icbc-raise-60b-yuan-debt-issue-20130117
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