Bank of America Said to Raise $7.3 Billion Selling CCB Shares

Bank of America Said to Raise $7.3 Billion Selling CCB Shares


May 12 (Bloomberg) -- Bank of America Corp. raised about $7.3 billion selling a stake in China Construction Bank Corp., said two people with knowledge of the matter.

Hopu Investment Management Co., Temasek Holdings Pte and other investors bought 13.5 billion shares sold by Bank of America, the people said, declining to be identified because they aren’t authorized to discuss the deal publicly. The shares were sold at HK$4.20 apiece, 14 percent below yesterday’s closing price, one of the people said. Bank of America spokesman Robert Stickler declined to comment.

Bank of America Chief Executive Officer Kenneth Lewis is under pressure to raise money after U.S. regulators said the company needs $33.9 billion in new capital. The Charlotte, North Carolina-based bank and foreign firms including UBS AG and Royal Bank of Scotland Group Plc have sold shares in Chinese lenders that they bought almost four years ago, after credit-market losses depleted their finances.

Construction Bank, the nation’s second-biggest lender, fell 1.8 percent to HK$4.81 in Hong Kong trading at 12:30 p.m. local time. The stock has gained 13 percent this year.

Construction Bank’s Beijing-based spokesman Yu Baoyue said he wasn’t aware of the sale. A Temasek spokeswoman, who declined to be identified, said she had no comment.

Hopu, founded by Goldman Sachs Group Inc.’s China partner Fang Fenglei in 2007, bought about 30 percent of a $2.3 billion Bank of China Ltd. stake sold by Royal Bank of Scotland in January, two people familiar with the deal said at the time. The fund raised $2.5 billion from overseas investors including Goldman and Temasek last year.

The stake sold by Bank of America represents 6 percent of Construction Bank’s outstanding Hong Kong stock. The U.S. bank owns another 25.6 billion shares that can’t be sold before Aug. 29, 2011.

BLOOMBERG