World Bank to buy 15% stake in Deyang City Commercial Bank

Oct. 20, 2009 (China Knowledge) - The International Finance Corp, the private-sector lending arm of the World Bank, announced Saturday that it has signed a share subscription agreement with Deyang City Commercial Bank, a small lender based in Deyang in Southwest China's Sichuan Province.

Pursuant to the agreement, IFC will invest RMB 211 million in Deyang City Commercial Bank for a 15% stake in the lender.

In addition, IFC, as a strategic investor, will provide technical support to the bank in areas such as corporate governance, credit management, internal control and risk management.

However, the deal is still subject to approval from the bank's shareholders and Chinese regulators.

Deyang City Commercial Bank, set up in November 1998 with a registered capital of RMB 100.28 million, is 19.94% held by the finance bureau of Deyang City, the largest shareholder.

As of the end of June, the bank had total assets valued at RMB 16.4 billion, with outstanding deposits of RMB 13.6 billion and outstanding loans of RMB 8.6 billion.

IFC in August invested RMB 5 million in Renshou Minfu Rural Bank in Meishan, Sichuan Province to support micro-financing in the area, according to an earlier report from China Knowledge.