BofA exits China's CCB with $1.5b sale
Updated: 2013-09-04 14:21
At the time, Bank of America's then chief executive Kenneth Lewis said the partnership was designed to give Bank of America more access to roughly 1.3 billion Chinese consumers, while CCB would benefit from BofA's US retail banking experience.
The US bank increased its holdings in following years, before paring it down starting in 2009. In 2011, the bank raised a combined $14.9 billion from selling shares in CCB to a group of investors that included Singapore's Temasek Holdings.
Bank of America launched Tuesday's sale after a lock-up on its remaining stake expired last month. The bank will continue its strategic partnership with CCB in business areas like customer service and sales models, the bank said in a press release.
Bank of America shares closed at $14.25 on Tuesday, up nearly 1 percent from Friday's close.
CCB shares are down 6.8 percent since the beginning of the year in Hong Kong, outperforming the 9 percent decline in the financial sub-index of the Hong Kong stock exchange.HSHFI in 2013.
Bank of America has been cleaning up its balance sheet since the financial crisis. In the bank's 2012 annual report, chief executive Brian Moynihan wrote that the bank had divested more than $60 billion of assets outside its main businesses while improving capital ratios and maintaining its earnings power.
The bank increased its second-quarter profit 70 percent to $3.57 billion. The bank managed to trim operating expenses by 6 percent while boosting its Basel III capital ratio.
The bank has been particularly active in streamlining its international operations. In recent years Bank of America sold its foreign wealth management businesses to Julius Baer Group and credit card portfolios in Canada, Spainand Britain to various banks and private-equity firms.
Some foreign banks continue to hold on to their investments in Chinese lenders. Among them are HSBC Holdings Plc, which owns a 19.9 percent holding in China's Bank of Communications Co Ltd and Spain's BBVA's has a 15 percent stake in China Citic Bank Corp Ltd.