Money

China markets brace for AgBank IPO pricing

(Agencies)
Updated: 2010-07-06 15:33

BENCHMARK FOR RIVALS

Bank of China and ICBC also have huge fund raisings planned.

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"The pricing would be a barometer of market demand for Chinese banking stocks," said Paul Lee, Hong Kong-based analyst at Tai Fook Securities. "I don't see much good news about Chinese banks in the short term", he said, citing concens over the share sales and worries about loans to local governments that could struggle to repay them.

Some investors are confident the market can absorb the $70 billion plus in bank fundraising plans headed their way by the year-end.

"Capital markets should be able to stomach the issues as there is abundant liquidity out there and the dual-listing has been widely priced in," said Chen Xingyu, an analyst with Phillip Securities Research. "The fact that it's listing in both Shanghai and Hong Kong is good for diverting capital so that it won't have a huge impact for any of them."