Citigroup bid on rocks

The auction of a controlling stake in Guangdong Development Bank may reopen after the government announced the rules on foreign investment would not be changed to accommodate a Citigroup-led consortium's bid, the Financial Times reported. The China Bank Regulatory Commission informed GDB at a meeting in Guangzhou, sources told the newspaper. The consortium intended to purchase an 85% stake in the Chinese lender. The decision means a major rethink for the financial services group that wanted 40% for itself. Current rules permit only a 25% holding in local lenders by foreigners, and a ceiling of 20% for a single entity.