Beijing-based Citic Bank will sell 2.3 billion shares in Shanghai and 4.95 billion shares in Hong Kong, according to a preliminary stock sale document posted on the Website of the China Securities Regulatory Commission. The regulator's listing committee is scheduled to review the application on Monday.

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Mainland banks are taking advantage of soaring stock prices to sell shares and extend a lending boom that helped fuel the nation's 10.7 percent economic growth last year. Banks are raising funds to bolster their finances and fend off foreign competitors, which in December were allowed to begin taking yuan deposits.

Citic Bank's IPO could raise US$3 billion to US$4 billion, bankers familiar with the sale told Bloomberg News. At the top end of that range, the deal would match United States buyout firm Blackstone Group LP's planned IPO as the third-biggest this year.

Bank blitz

Since June 2005, six mainland banks have sold a combined US$51 billion worth of IPO shares, including a US$2 billion Shanghai offering by Industrial Bank in February. In addition, China Minsheng Banking Corp completed a US$1.8 billion private placement this month.

Citic Securities Co, China International Capital Corp, Lehman Brothers Inc, Citigroup Inc and HSBC Holdings Plc are managing Citic Bank's offering.

Shares of mainland banks including the two largest - Industrial & Commercial Bank of China Ltd and Bank of China Ltd - have surged since their IPOs last year, enticing smaller competitors to follow suit. The benchmark Shanghai and Shenzhen 300 Index more than doubled in the past year.

Citic Bank, the mainland's eighth-largest by assets, boosted profit by 25 percent to 3.86 billion yuan (US$499 million) last year. The bank had 453.4 billion yuan in loans outstanding and 618.4 billion yuan in deposits as of December 31.

The bad-loan ratio was 2.5 percent at year's end. The capital adequacy ratio, a measure of financial health, stood at 9.41 percent, above the regulatory requirement of eight percent.

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