Beijing's Bank of China last month sold 1.6 percent of its shares for US$500 million to UBS. In August it sold a 10 percent stake to an alliance formed by the Royal Bank of Scotland, Merrill Lynch and the Li Ka Shing Foundation, for US$3.1 billion, as well as another 10 percent stake to Temasek Holdings for US$3.1 billion.
While China's banking reforms have made some progress over the past two years, Moody's Investor Serice said last week that Beijing needs to extend this beyond just initial public offerings.
"The state banks need to be transformed into competitive commercial entities which requires much more than just fixing the balance sheets through recapitalization and IPOs," the international ratings agency said in a statement.
In Taiwan, the government is moving to show its determination to continue with banking reform. Last week Premier Frank Hsieh (謝長廷) said the Cabinet plans to sell 20 percent to 30 percent of the government's holdings in the Bank of Taiwan (台灣銀行) to international banks.
"Since overseas investors have diverted their attention to China, local lenders may not be appealing enough to gain strategic investment if they remain stuck ... under restrictions [on expansion across the Taiwan Strait]," said Karl Tseng (曾志峰), a fund manager who manages funds worth NT$830 million at HSBC Investments (Taiwan) Ltd.
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