(Yicai Global) Sept. 22 -- Southwest China-based Chongqing Rural Commercial Bank [HKG:03618] has won approval for its planned IPO on the Mainland market from its local China Banking Regulatory Commission (CBRC) branch, bringing it one step nearer to a landing on the A-share market.
Chongqing Rural went public in Hong Kong in 2010, becoming the first local bank on the H-share market there. In June, the bank announced the launch of its A-share issue, at a scale not to exceed 1 billion 357 million shares.
Chongqing Rural said that listing on the Mainland will create a domestic and international financing platform, and achieve share mobility on behalf of all stockholders. The firm plans to list on the Shanghai Stock Exchange (SHE) to raise funds to supplement its bank capital.
Chongqing Rural grew very fast after listing, though signs of slowing growth were visible last year. The bank's net profit in 2015 was USD1 billion (CNY7 billion) -- an increase of 6 percent -- while the 2014 increase was 13 percent. The bank's capital adequacy ratio has been in decline for the two years since 2014. Analysts believe that the additional capital the IPO will yield will improve the bank's ability to resist risks, which has become a pressing demand of Chongqing Rural Commercial Bank.