Bank of America said Monday it will boost its stake in China’s third-largest bank, China Construction Bank to 19.1% from 10.75%, reports Reuters. The move should end speculation that BofA might sell some of its three-year-old investment to bolster its own capital, as losses mount from deteriorating consumer credit. BofA, which is in the process of acquiring Merrill Lynch, said it will increase its stake in CCB by exercising the rest of an option to buy shares from China SAFE Investments, a state investment arm. Following the purchase, BofA would own 44.7bn shares. The bank said it expects to close the transaction this month, and “remain a long-term and significant strategic investor” in CCB. BofA’s investment in the Chinese bank, which has a market value of about $126bn, has so far proven successful for the third-largest US bank. CCB shares have risen 75% since its October 2005 IPO, despite falling by more than half from their October 2007 peak.
