China’s Foreign Exchange Administration Unit Buys Stakes In Banks

Wutongshu Investment Platform Co. Ltd., a platform for investing foreign exchange reserves established in November 2014 by China’s State Foreign Exchange Administration, has injected capital into the country’s biggest banks, according to Caixin Media.

Wutongshu is now among the top ten shareholders of Bank of China and Industrial and Commercial Bank of China, with a 0.36% and 0.4% stake in each bank, respecitvely.

It is also the eighth biggest shareholder of Bank of Communications with a 1.07% stake, and the seventh largest shareholder of Shanghai Pudong Development Bank Co. Ltd with a 3.15% interest, according to their latest quarterly reports.

"Wudongshu may be the latest new member among government agencies to save the stock market," according to the Caixin article citing an anonymous executive at a brokerage firm.

Previously, the unit established a China-African cooperation fund last November and a China-Latin America cooperation investment fund last June.

It joined the Export-Import Bank of China, China Development Bank Capital Corporation Ltd. and other financial institutions to establish the Silk Road Fund last December.

In August 2015, Wutongshu invested US$48 billion into China Development Bank to reinforce its capital adequacy.