Industrial & Commercial Bank of China Sets New IPO Record at $19.1 Billion

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Industrial & Commercial Bank of China Raises $19.1 Billion in Share Sale [Bloomberg]

Summary: Industrial & Commercial Bank of China, usually referred to as ICBC, raised an IPO record $19.1 billion with orders equaling $500 billion, or twice Citigroup's market value. ICBC is the first simultaneous offering in Hong Kong and Shanghai, and will begin trading on October 27th, at which time it could surpass Japan's Mitsubishi UFJ -- valued at $135 billion -- to become the world's 5th largest bank. ICBC said it will use the share sale to strengthen its capital base for expansion. China's Ministry of Finance and a state holding company each own 36.2% of ICBC, with a Goldman Sachs-led investor group owning 7.4%, and the IPO representing a 14.8% share. ICBC has the largest retail banking customer-base in China, servicing 153 million, compared to Russia's entire population of 143 million, as the Bloomberg journalist mentions. Shares of rival Bank of China, the second largest bank in China, have risen 15% since it completed an $11.2 billion IPO in May that was also heavily oversubscribed.
Related links: Goldman's Huge Paper Profits in China's ICBC IPO • Morgan Stanley Acquires Small Commercial Bank in China • China's Banking Sector Looks Better with New Corporate Bankruptcy Law • An Interesting Play on China's Banking Sector: Bank of East Asia • Developments in China's Banking Sector • Highlights from Bank of China's Mega-IPO
Potentially impacted stocks and ETFs: Goldman Sachs (GS) • iShares FTSE/Xinhua China 25 Index ETF (FXI) [Offers exposure to Bank of China, Bank of Communications and China Construction Bank, for a combined ~20% of assets.]

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