When Bank of America (BofA) sold a 3.18% stake in China Construction Bank (CCB) to Chinese private equity firm Hopu Investment Management last year, the US financial services group did more than pick up a handy $4 billion at the height of the global recession.
It also marked the latest and somewhat bizarre retrenchment from China by a leading financial services group. Not so long ago, foreign lenders were jostling frantically to gain a toehold in the world’s fastest-growing (but still largely isolated) big banking market. They lobbied their governments for access to China’s 800 million savers, grouching when denied entrance and jumping for joy when the door creaked ajar. Yet now, it seemed, they couldn’t get out quickly enough.
BofA’s stake sale in May 2009 followed hard on the heels of a welter of foreign divestments. Troubled RBS Group sold its 4.26% stake in Bank of China (BOC) in January 2009. Later the same year, key investors in the country’s largest lender, Industrial and Commercial Bank of China (ICBC) – Goldman Sachs, American Express, Germany’s Allianz, and a charitable foundation headed by Hong Kong’s richest man, Li Ka-shing – took advantage of record-high China banking stocks to sell their stakes.
