China Merchants Bank plans raising $4.5bn

The lender may seek help from its parent company to raise capital in complying with its higher capital adequacy requirements.

China Merchants Bank may be planning to raise up to 30 billion yuan ($4.54 billion), reports 21st Century Business Herald, citing unnamed industry insiders.

There were rumors in the market that the bank is in discussions with its parent, China Merchants Group, on its fundraising plan.

According to an unnamed insider from the bank, the bank is in need of capital due to the higher capital adequacy requirements and increased risks from the financing platforms of local governments. However, the insider did not comment regarding the timing and scale of the fundraising.

Separately, China Minsheng Banking Corporation had announced that it plans to raise 21.48 billion yuan ($3.25 billion) through an additional share offering. Agricultural Bank of China will be issuing 50 billion yuan (7.57 billion) worth of subordinated bonds while Industrial Bank is to issue 15 billion yuan (2.27 billion) worth of subordinated bonds.

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