South African banking giant Standard Bank Thursday announced a major strategic partnership with the Industrial and Commercial Bank of China Limited (ICBC) in terms of which ICBC will become a 20 percent shareholder in Standard Bank Group.

The bank said in a statement that this deal will result in a 36. 7 billion rand (approximately 5.5 billion U.S. dollars) equity investment into Standard Bank, which is the largest foreign direct investment into the country and is a landmark transaction for Africa, South Africa and Standard Bank.

Foreign ownership of Standard Bank, currently at around 25 percent, will increase to approximately 40 percent after the proposed transaction, leaving Standard Bank still majority South African-owned.

The transaction is subject to the approval of the South African Registrar of Banks, the China Banking Regulatory Commission, the Johannesburg Securities Exchange (JSE), and Standard Bank and ICBC shareholders.

ICBC is the world's largest bank by market capitalization, with a market capitalization of approximately 319 billion dollars as at the close of business on Oct. 22, 2007.

It is listed on the Hong Kong and Shanghai stock exchanges, having over 16,000 branches in China, nearly 100 branches elsewhere in the world and 2.5 million corporate and 180 million personal bank customers.

ICBC Chairman Jiang Jianqing said: "From a strategic perspective, ICBC has been seeking opportunities to expand its international business, in particular in Africa given strong trade linkages and the close and long standing friendship between China and South Africa."

"As many of our large clients seek investments in Africa, the demand for cross border financial services is accelerating. Standard Bank with its market leading position in South Africa and a true pan-African footprint, represents the best organization with which ICBC can partner," he added.

Jacko Maree, Standard Bank Group chief executive, said: "A partnership between Standard Bank and ICBC is attractive as each party brings numerous complementary benefits to the relationship. Both banks can benefit through the creation of new revenue streams, access to the new partners' expertise and sharing distinctive local market knowledge and expertise."

Trade and investment flows have developed between China, South Africa and other areas of Africa over the past few decades. Recently, both the relative size, area of focus, and bilateral nature of such trade have increased dramatically.

"ICBC shares Standard Bank's vision about the long-term investment proposition for Africa and, together with Standard Bank, hopes to lay the foundation for significant expansion of such trade and investment between its Chinese clients and the African continent," said Maree.

(Xinhua News Agency October 26, 2007)