Search China Travel News:

Australia and New Zealand Banking Group Ltd. will sign a deal on Tuesday to buy a fifth of a small Chinese lender for about $110 million, two senior executives involved in the deal told Reuters on Monday.

ANZ, Australia's third-largest bank, will sign the wide-ranging agreement that calls for a strategic partnership and technical assistance with Tianjin City Commercial Bank, one of China's 100-plus municipal banks, the sources said.

ANZ spokesman Paul Edwards confirmed the agreement would be signed on Tuesday but declined further comment. The deal still needs regulatory approval, the two sources said.

ANZ said earlier this year it was poised to buy up to 20 percent of Tianjin City Commercial Bank following negotiations that lasted more than a year.

China allows a single foreign investor to own no more than 20 percent of a Chinese bank's shares. Combined foreign investment is capped at 25 percent.

"The 20 percent investment in Tianjin Bank will be approximately $110 million," said one senior executive who was involved in the year-long negotiations.

"The deal will include other cooperation agreements such as technical support and risk management."

A Tianjin Bank executive said ANZ will appoint a vice president, who will also sit on the Chinese lender's board, to help oversee daily operations.

The tie-up with Tianjin Bank would mark ANZ's first direct investment in a Chinese lender and would give it access to the country's $1.7 trillion in savings once the arena opens wider to foreign competition by the end of 2006.