China extends lock-up period on bank stake sales

The chairman of the China Banking Regulatory Commission (CBRC), Liu Mingkang, said that future foreign investors in Chinese banks will be required to accept a five-year lockup period on share sales, the Financial Times reported. The decision was made after a number of foreign banks, including Bank of America, UBS, and Royal Bank of Scotland sold off part or all of their stakes in Chinese state-owned banks at the end of their three-year lockup period. The CBRC said that Beijing will not increase the ownership limits for foreign investors in Chinese banks — currently capped at 20% per investor and 25% combined foreign ownership — and that it decided last year not to allow increased foreign involvement in domestic institutions. Until now that decision has been kept private.