On 17 Mar 2008, Huaxia Bank Co. Ltd issued its 2007 Annual Report. On the same day, the company's proposal for a private placement for RMB 11.56 bln was approved by its board of directors. Of the private placement, Shougang Group will purchase RMB 3.942 bln shares, State Grid will purchase RMB 3.706 bln shares and Deutsche Bank will purchase RMB 3.909 bln shares.

Sinolink Securities had projected that Huaxia bank may issue 790 million shares at RMB 14.58 per share. Following the private placement, the capital adequacy ratio of the bank is expected to reach 10.7% and core capital adequacy ratio is expected to reach over 7.4%. The bank's equity structure will change as follows: Shougang will hold 13.96% shares, State Grid will hold 11.92%, and Deutsche Bank will hold 13.68%, becoming Huaxia Bank's second largest shareholder after Shougang.

Source: 21st Century Business Herald

Date: 19 Mar 2008

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