BofA sells stake in China Construction Bank
Bank of America (BAC) agreed to sell 10.4 billion common shares of China Construction Bank Corp. as part of a plan to strengthen its Tier 1 capital ratio. The Charlotte, N.C.-based banking giant expects proceeds of about $1.8 billion from the private transaction, which is set to close by the end of November, upon regulatory approval. Following the sale, Bank of America will own 1% of the large Chinese commercial bank. "Our decision to sell the bulk of our remaining shares in China Construction Bank is consistent with our stated objective of continuing to build a strong balance sheet," said BofA Chief Financial Officer Bruce Thompson. "We expect this action, supplemented by the related realization of deferred tax assets, will generate approximately $2.9 billion in additional Tier 1 common capital and further strengthen our Tier 1 common capital ratio by approximately 24 basis points under Basel I," he said. Write to Kerri Panchuk.