The Bank of Communications, China's fifth-biggest lender, intended to proceed with the Shanghai portion of its initial public offering (IPO), contrary to media reports, a source close to the situation said.

The source was commenting on a Hong Kong press report Friday saying the bank, which is planning a simultaneous listing in Shanghai and Hong Kong, may drop the mainland leg because of the poor performance of mainland stock markets.

The bank has planned a simultaneous listing in Hong Kong and Shanghai, and it is expected to be one of the biggest IPOs in Hong Kong this year.

The Shanghai-based bank now plans to sell 15 percent of its existing shares for up to US$2 billion in Hong Kong by late May at the earliest, instead of selling US$3 billion in shares as earlier planned, The Standard quoted sources close to the deal as saying.

HSBC Holdings would maintain its 19.9 percent stake in the Chinese bank by buying new shares during the stock offering, the sources said.

The bank posted a 30.1 percent jump in 2004 operating profit despite nationwide credit curbs.

Source: Shenzhen Daily-Agencies