The Industrial and Commercial Bank of China (ICBC) has agreed to step up business co-operation with China Construction Bank (CCB) by offering syndicated loans to large company clients.

According to the agreement signed between the two banks yesterday, they can both provide loans or other credit services to the same borrower. Other commercial banks are also welcome to join them.

But officials from the two banks declined to give further details.

Jiang Jianqing, president of the Industrial and Commercial Bank of China, claimed the co-operation was a strategic measure taken by the two banks to improve their business and efficiency.

The reform of China's State-owned commercial banks was not just a financial reshuffle, Jiang said. "Banks will have to improve their corporate governance and try to increase their competitiveness."

Wang Zhao, a senior researcher with the State Council Development Research Centre, said the co-operation between the two banks will be helpful in increasing their credibility and profit margins.

Last month the government approved a share-holding reform plan of the Industrial and Commercial Bank of China and agreed to inject US$15 billion to boost the bank's capital. Jiang said his bank will try to finish the reform this year and then seek an initial public offering on domestic and overseas markets.

China Construction Bank established a joint stock listing vehicle named China Construction Bank Corporation last September, following the split of the institution into two parts.

Source: China Daily