The IPO of Industrial and Commercial Bank of China and the 'Chinese Model' of Privatizing Large Financial Institutions

Franklin Allen, Susan Chenyu Shan, Jun Qian and Mengxin Zhao
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Franklin Allen: University of PA
Susan Chenyu Shan: University of Hong Kong
Jun Qian: Boston College
Mengxin Zhao: University of Alberta

Working Papers from University of Pennsylvania, Wharton School, Weiss Center

Abstract: We examine the privatization process of the Industrial and Commercial Bank of China (ICBC), the largest bank in the world by market capitalization, and its dual IPOs in the Hong Kong and Shanghai Stock exchanges in 2006. The Chinese government retains majority equity ownership of ICBC while foreign institutional investors hold minority equity stakes. Other large financial institutions went through the same reform process and have similar, post-IPO ownership structures. The largest Chinese banks, as a group, outperformed their counterparts from other emerging and developed markets before and during the 2007-2009 financial crisis. We argue that the 'Chinese model' of privatizing and managing large financial institutions can be advantageously used in other countries.

JEL-codes: G20 G30 L10 (search for similar items in EconPapers)
Date: 2012-01
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Citations: View citations in EconPapers (3)

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