China's BoCom earns $2.5bln in rights issue

Lender still needs $2.34bln to achieve $4.84bln target for combined Shanghai and Hong Kong rights issue.

Bank of Communications (BoCom), China's 5th biggest lender, said on Tuesday it had completed its rights issue of Yuan-denominated A shares, raising 17.13 billion Yuan ($2.52 billion) after attracting strong demand as expected.

BoCom, about one-fifth owned by HSBC Holdings Plc, had set a 1.5-for-10 rights issue for its Shanghai and Hong Kong-listed shares, aiming to raise a combined $4.84 billion.

The bank said investors bought 97.84% of the A shares on offer in the issue, which was first announced in February and obtained preliminary regulatory approval on May 28, according to a report in Reuters.

Chinese banks are rushing to raise funds to bolster balance sheets stretched by a lending spree last year in support of government efforts to reinforce economic growth.