Industrial and Commercial Bank of China (ICBC) is to buy up to 20% of South Africa’s Standard Bank for USD 5.46 billion. This deal will be the biggest overseas acquisition by a Chinese commercial bank. It will also be the largest foreign direct investment into South Africa and is a landmark transaction for Africa, South Africa and Standard Bank.

Standard Bank is heading in Africa in asset terms, reaching about USD 162 billion by the end of the first half of 2007. In terms of Tier 1 capital, it is the winning bank in Africa and the 106th in the world. The bank boasts 1051 branches in 18 African countries and around key financial centers of Europe, America and Asia. Standard Bank went public on the Johannesburg Stock Exchange back in 1970 and had a market capitalization well over USD 21.5 billion on October 22, 2007.

Foreign ownership of Standard Bank, currently at around 25%, will increase to approximately 40% after the proposed transaction, leaving Standard Bank still majority South African–owned. The transaction is subject to the approval of the South African Registrar of Banks, the China Banking Regulatory Commission, the JSE, and Standard Bank and ICBC shareholders.

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