China Construction Bank Corp (CCB) is raising at least 100 billion yuan ($15 billion) for a fund to finance investments related to Beijing’s Belt and Road initiative, people familiar with the matter told Reuters. The people said China’s second-biggest bank by assets was raising cash onshore and offshore, and has already been running roadshows with prospective investors. They could not be identified as they are not authorised to speak to the media.
CCB did not immediately respond to a Reuters request for comment.
Chinese President Xi Jinping in May pledged a $124 billion funding boost to help his plan to build a modern Silk Road, connecting China with new and old trading partners. He also said China would encourage financial institutions to expand their overseas yuan fund businesses. Beijing is trying to contain overseas deals after some extravagant purchases in recent years, but acquisitions by Chinese companies in countries that are part of the Belt and Road initiative are soaring, totalling $33 billion as of mid-August. That compares with a $31 billion tally for all of 2016, showed Thomson Reuters data.
The people said CCB would raise U.S. dollars for the offshore portion of the fund and yuan from onshore investors. Some of the onshore capital could be used for Belt and Road deals overseas, two of the people said.