ANBANG Property & Casualty Insurance Co. has raised its stake in China Merchants Bank Co. to 5 percent after buying an additional 1.13 billion shares.

    The purchase will bring Anbang’s total stake to 1.26 billion shares, Merchants Bank, the country’s sixth-largest bank by assets, said in a filing to the Shanghai Stock Exchange yesterday.

    Unidentified investors sold China Merchants Bank’s yuan-denominated A shares valued at 13.7 billion yuan (US$2.26 billion) in block trades Monday, the Shanghai exchange said in a separate statement. The buyers were also unidentified.

    One block of 1.13 billion China Merchants Bank A shares was traded at 12.07 yuan, up 10.7 percent from the bank’s closing price of 10.90 yuan Monday, the exchange said. Block trades take place after the market closes.

    The deal may be the Shanghai exchange’s largest block trade in terms of value so far this year.

    The property and casualty insurance unit of Beijing-based Anbang bought the shares. Anbang, whose shareholders include state-owned Shanghai Automotive Industry and China Petrochemical, offers insurance and asset management services.

    Bloomberg reported last month that Anbang is among companies considering bids for Wing Hang Bank, Hong Kong’s second-largest family-run lender.

    But sources with knowledge of the matter said last week that Anbang is balking at the asking price for Wing Hang.

    Shares of Wing Hang declined yesterday as investors speculated Anbang has abandoned interest in the Hong Kong bank.

    “Anbang’s investment in China Merchants Bank could mean they’re dropping interest in Wing Hang Bank,” Ronald Wan, chief China adviser at Asian Capital Holdings Ltd., said yesterday. “If they can’t agree on a price with Wing Hang, it’s a dead end.”

    Anbang has indicated it’s willing to pay no more than 1.7 times the Hong Kong lender’s book value this year, less than an asking price of about two times. (SD-Agencies)