ABC seeks foreign financial advisors

Agricultural Bank of China (ABC) has invited investment banks to apply to act as financial advisors during the bank's restructuring, the South China Morning Post reported. According to market sources, UBS, China International Capital Corp, BOC International and HSBC are among the likely bidders. In order to prepare ABC for an eventual initial public offering, the Ministry of Finance is expected to write off US$10.2 billion in equity it holds in the bank while the central bank injects a further US$25 billion to improve the balance sheet. Restructuring is complicated by the key social role ABC plays in supporting China's poor rural population. Last year, 26% of its loans – US$90 billion – were non-performing. Meanwhile, the Financial Times reported that Industrial and Commercial Bank of China (ICBC) has applied to bring back to China the US$16.1 billion it raised overseas through its October IPO. It said the funds would be easier to use if converted into renminbi.