Pension fund buys strategic ICBC stake

The Industrial and Commercial Bank of China agreed Monday to sell a 5% strategic stake to the country's social security fund for around US$2.25 billion. The deal, still pending final approval by the China Banking Regulatory Commission, is believed to be the largest single pre-initial offering direct equity investment agreed by the National Social Security Fund to date, and comes as the Beijing-based lender seeks government approval for an up to US$15 billion listing in Hong Kong later this year. The fund, which was established in August 2000 to finance social security, also made pre-initial public offering investments in BOC and Bank of Communications worth US$1.25 billion. At the end of last year, the fund owned US$2.9 billion worth of listed stocks and US$1.63 billion of unquoted equity, with a realized annual investment yield of 3.12% per cent.