HONG KONG, July 14 (Reuters) - Agricultural Bank of China is expected to pay a total of $248 million in fees to the firms handling its $19.3 billion initial public offering, the lowest underwriting payout by any of China's Big Four banks.
Sources involved in the process said 1.4 percent, or $147 million, of the $10.5 billion in proceeds from the Hong Kong H-share offering would go to underwriters. That total excludes the over-allotment that is part of the offering.
AgBank publicly announced that it was paying the banks involved with its Shanghai listing a total of 688 million yuan in fees, or $101 million -- a 1.15 percent charge.
Industrial and Commercial Bank of China (ICBC) , which raised a record $21.9 billion in its 2006 dual listing paid an about 2 percent fee for its Hong Kong offering, sources involved with that deal said.
If AgBank exercises its over-allotment shares, it will raise more than $22 billion through the IPO, the world's largest ever.
AgBank shares will start trading in Shanghai on July 15 and a day later in Hong Kong.
China International Capital Corp (CICC), Deutsche Bank AG , Goldman Sachs Group Inc, JPMorgan Chase & Co , Macquarie Group and Morgan Stanley are the banks handling the Hong Kong offering, along with AgBank's own securities unit. Underwriters for the Shanghai deal are CICC, Citic Securities Co, Galaxy and Guotai Junan Securities.
While working on the AgBank IPO comes with the prestige of being part of what could be the largest-ever such offering, the actual pay out is lower than the market rate. Hong Kong IPO's usually come with a 3.5 percent fee.
AgBank, founded in 1951 by Mao Zedong as the rural unit of the central bank, is the last of China's 'Big Four' state-owned lenders to list shares.
AgBank had a 2009 non-performing loan ratio of 2.9 percent, compared with an average 1.5 percent at the other three state banks.
The bank has nearly 24,000 branches and employs more than 441,000 people, eclipsing ICBC and China Construction Bank (CCB) , the world's two biggest banks by market value.
(Additional reporting by Fiona Lau; Editing by Michael Flaherty and Chris Lewis)
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