Standard Chartered strikes deal with China’s Agricultural Bank

MoU enabled lenders to work in wholesale and retail banking operations starting in Hong Kong.

Standard Chartered and Agricultural Bank of China said that they had signed a memo of understanding to establish a strategic partnership, a month before the Chinese lender’s anticipated initial public offering.

The two lenders said they would look at working together in wholesale and retail banking in China and abroad, with a particular focus on Asia and Africa.

As a possible testing ground for their collaboration, they named Hong Kong.
The announcement was made the same day that Agricultural Bank started the road show for the Shanghai part of its upcoming initial public offering, with which it hopes to raise $23 billion with both a mainland and Hong Kong listing.

Local media like China Daily cited unidentified sources as saying that Standard Chartered may also become a cornerstone investor in the I.P.O., joining sovereign funds like Temasek in Singapore, as well as investors from Kuwait and Qatar.

The Chinese bank has had to pare back its ambitions for the I.P.O. from $30 billion, which would have been the largest ever, to a size that will make it the year’s biggest if all goes well.

View the full story in the New York Times.