BofA To Sell Remaining Stake In China Construction Bank
CHARLOTTE (dpa-AFX) - Bank of America Corp. (BAC) said Tuesday that it agreed to sell its remaining equity investment in China Construction Bank Corp., representing about 2 billion shares, or 1% of all China Construction Bank shares outstanding.
However, the strategic assistance agreement between Bank of America and China Construction Bank, which was recently extended to 2016, will continue.
Under the strategic assistance agreement, Bank of America provides advice and assistance to China Construction Bank in specified business areas, focusing on processes and systems including customer service and sales models. Bank of America benefits through increased brand recognition in China and enhanced international business experience for Bank of America employees. About 3,100 Bank of America employees and 5,000 China Construction Bank employees have participated in strategic assistance agreement exchanges since 2005.
Bank of America said it expects the deal to generate a pretax gain of about $750 million in the third quarter of 2013.
The gain could be partially offset by negative fair value option adjustments and debit valuation adjustments if the company's credit spreads, which have improved significantly during the third quarter of 2013, remain at current levels when measured on September 30, 2013.
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