January 29, 2010

Agricultural Bank of China may not launch IPO this year

Agricultural Bank of China may not launch a long-awaited initial public offering this year as uncertainties still exist over the future of the lender's business with reference to the agriculture sector.
 

Though ABC is basically ready for listing, top policymakers has not reached a consensus on whether to run the lender as a commercial entity or maintain its rural finance unit as a policy lending arm of the government.

The key issue is whether the lender's rural finance arm will continue to enjoy government subsidies after the IPO.

Earlier media reports said that the bank plans to raise up to RMB150 billion (US$22 billion) via a public float as early as April this year.

ABC Chairman Xiang Junbo said recently that the bank's listing timetable depends largely on the progress it makes in rural finance reform, which started in 2008. As part of the reform, the bank established a new unit to specifically focus on rural finance.