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ABC’s problems keep it far behind the competition |
China’s cabinet has approved a capital injection into ailing state lender Agricultural Bank of China, priming it for an initial public offering in late 2009 or 2010. In addition, $150 billion to $200 billion of failed loans will be sucked out of ABC, which was set up in 1979 to provide financing to China’s 800 million farmers, and stored in one or several of the country’s leading asset management companies.
In a year full of record bail-outs, the capital injection will be provided by Central Huijin, a division of China Investment Corporation (CIC), Beijing’s sovereign wealth fund, ABC vice-president Pan Gongsheng told a press conference on October 22. Set up in 2005 to oversee the bail-out of other leading Chinese banks, Central Huijin will take a 50% stake in ABC, with the remainder to...
