Bank of China targets $10bn IPO

Bank of China hopes to raise up to US$9.9 billion in Hong Kong in the world's largest initial public offering in six years, Bloomberg reported. The nation's second biggest lender intends to sell 25.6 billion shares – a 10.5% stake – for the equivalent of between US$0.32 and US$0.39 each. The bank is selling shares at 1.9 times to 2.2 times their book value in the hope of attracting investors that may be interested in rivals. Bank of China's non-performing loan ratio could reach 4.3% this year, compared to the 3.4% of China Construction Bank and 2.5% of Bank of Communications. The underwriters may choose to increase the offering by 15%, to US$11.39 billion, to meet demand.