Thursday, 11 August 2011

BofA negotiates to sell big China bank stake: sources | Reuters

Bank of America Corp (BAC.N) has held exploratory talks with the principal investment funds of Kuwait and Qatar about selling part of its stake in China Construction Bank (0939.HK), sources with direct knowledge of the talks told Reuters.

Bank of America, which owns about 10 percent of CCB's (601939.SS) Hong Kong-listed shares and is scurrying to raise capital for its mortgage-scarred balance sheet, will be contractually free to sell the bank shares after August 29. They are valued at about $17 billion.

The bank, the largest in the US by assets, is likely to sell half its stake in order to shore up its Tier 1 capital. Analysts believe Bank of America needs about $50 billion to meet new capital requirements.

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