Central Huijin Adds Stakes In China’s Big Four Banks

Central Huijin Investment Ltd., a state-owned investment company designed to hold stakes in Chinese financial institutions, increased its stakes in the nation’s four biggest banks, according to statements released by the four banks.

Central Huijin purchased 19.3 million shares of Industrial & Commercial Bank of China, 42.9 million shares of Agricultural Bank of China, 24.5 million shares of China Construction Bank and 18.5 million shares of Bank of China Ltd.

According to calculations based on average trading prices, the share purchases cost Huijin RMB363 million ($59 million).

As the Chinese economic future faces greater uncertainty, the benchmark Shanghai Composite Index has dropped 11% from this year’s high set on February 6. Huijin’s share purchases aim to boost China’s sagging stock market and to help boost investor confidence.

The big four banks also said that Huijin will continue to raise its stakes in the next six months.

Last week, Huijin also raised its holdings in China Everbright Bank Co. by 22 million shares and New China Life Insurance Co. by 2 million shares.

Last time Huijin increased its stakes of the big four banks was on October 10, 2012. Before that, Huijin had purchased shares of the big four banks for three more times, but was only able to boost stock prices for a brief time.

China Expert Network
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