BEIJING (XFN-ASIA) - China's new sovereign wealth fund plans to invest a third of its 200 bln usd start-up capital 'gradually and cautiously' in financial products, a senior finance ministry official said.
Vice-Minister of Finance Li Yong told a conference here that around one-third of the China Investment Corporation's (CIC) start-up capital -- equivalent to around 67 bln usd -- will be used to inject funds into both the Agricultural Bank of China and the China Development Bank.
He said that another third will be used to buy Central Huijin Investment, a holding company under the central bank.
The remainder will be used to invest 'gradually' and 'cautiously' in financial products, Li said, without providing further details.
The CIC was officially launched in late September and is intended to seek more aggressive returns for a portion of China's foreign exchange reserves.
The ministry plans to issue a total 1.55 trln yuan in special treasury bonds as part of plans to buy 200 bln usd in reserves from the People's Bank of China.
The Agricultural Bank is the last of the 'big four' state-owned lenders to be restructured, while the China Development Bank, one of the government's three policy lenders, was slated for reform earlier this year.
The PBoC established Huijin in 2003/4 to hold its stakes in the Bank of China, Industrial and Commercial Bank of China and China Construction Bank following their respective bail-outs.
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bj/kmq xfnjbw/xfnkm COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
Vice-Minister of Finance Li Yong told a conference here that around one-third of the China Investment Corporation's (CIC) start-up capital -- equivalent to around 67 bln usd -- will be used to inject funds into both the Agricultural Bank of China and the China Development Bank.
He said that another third will be used to buy Central Huijin Investment, a holding company under the central bank.
The remainder will be used to invest 'gradually' and 'cautiously' in financial products, Li said, without providing further details.
The CIC was officially launched in late September and is intended to seek more aggressive returns for a portion of China's foreign exchange reserves.
The ministry plans to issue a total 1.55 trln yuan in special treasury bonds as part of plans to buy 200 bln usd in reserves from the People's Bank of China.
The Agricultural Bank is the last of the 'big four' state-owned lenders to be restructured, while the China Development Bank, one of the government's three policy lenders, was slated for reform earlier this year.
The PBoC established Huijin in 2003/4 to hold its stakes in the Bank of China, Industrial and Commercial Bank of China and China Construction Bank following their respective bail-outs.
bjburo@xfn.com
bj/kmq xfnjbw/xfnkm COPYRIGHT Copyright Thomson Financial News Limited 2007. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
© 2007 AFX News
