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China Construction Bank, China's biggest property lender, plans to sell shares for the first time by the end of the year. It is expected to raise US$5 billion in an initial public offering for about 15 percent of the company, with the shares to be listed in Hong Kong.

The Hong Kong-based South China Morning Post newspaper reported on Thursday that the bank has filed a preliminary application with the Hong Kong stock exchange for the share offer.

It is likely to be the second-biggest international public offering by a Chinese mainland company.

On June 17, Bank of America Corp said it would pay US$3 billion for a 9 percent stake in the Chinese bank.

Bank of America said that it has the option to lift its holding in China's top property lender over the next five and a half years to 19.9 percent, the maximum allowed under Chinese law.

The US bank said it will initially invest US$2.5 billion in Construction Bank, and buy a further US$500 million when the Chinese bank lists shares in Hong Kong.

A source familiar with the situation said last week that Bank of America will get one China Construction Bank board seat. The source said other potential investors may also take stakes in Construction Bank, but they were highly unlikely to be direct competitors of Bank of America, Reuters reported.

Bank of America has been looking to expand abroad after reaching the 10 percent maximum share of deposits in its home market.

Bank of America's purchase would account for 7 to 8 percent of China Construction's expanded share capital after its planned IPO overseas, or 9 percent based on its current share capital, sources said.

China Construction Bank this month said pre-tax profit rose 34 percent last year to 50.2 billion yuan (US$6.1 billion). The bank received in late 2003 a US$22.5 billion government bail-out that let it write off many bad loans.