BoCom set to raise funds via rights issue

Bank of Communications (BoCom), China's fourth largest lender by market value, is likely to raise up to 30 billion yuan through a rights offering in Hong Kong and Shanghai to replenish its capital base, people with knowledge of the matter said yesterday.

The Shanghai-based lender may offer 1.5 new shares priced between 3 and 4 yuan apiece for every existing 10 shares, the source said. That would take the total funds raised by the bank to around 25 to 30 billion yuan.

The source also indicated that the rights issue price would be at least 50 percent lower than the bank's closing share price of 8.14 yuan in Shanghai yesterday.