Bank of Shanghai seeks IPO in HK to raise 15b yuan

Bank of Shanghai plans to raise about 15 billion yuan ($2.39 billion) through an initial public offering in Hong Kong this year to supplement its capital, the Shanghai Securities News reported on Tuesday, citing an internal document circulated to the bank's shareholders.

The newspaper said the lender also plans to raise about 15 billion yuan via a public listing on the mainland, without giving a timetable.

The planned listings in Hong Kong and on the mainland are subject to the approval of the China Securities Regulatory Commission, the SSN report said.

The bank launched an IPO plan in 2008 but has not completed the program due to several factors. The lender is planning to extend the validity of the plan to May 2014.

Bank of Shanghai is among several Chinese companies looking to raise funds outside the mainland market as the domestic IPO market has been frozen since November 2012, and the regulator said that there isn't an immediate timetable to re-launch the IPO channel. More than 800 companies are waiting to get approval to be listed in Shanghai and Shenzhen.

The lender is also considering issuing 5 billion yuan worth of subordinated debt in the domestic market to replenish its capital, if the application for the IPO in Hong Kong is turned down. The plan is to raise its capital adequacy ratio to meet the regulators' demands.