China Mobile, the world's biggest mobile phone carrier by users, may buy equity stakes in the country's biggest commercial bank ICBC, in a move encouraged by the country's top State asset watchdog, people with knowledge of the matter said.

"State-owned Assets Supervision and Administration Commission (SASAC) is pushing China Mobile to buy stakes in the Industrial and Commercial Bank of China, but the discussion is still in the early stages," the person said.

It will be the parent company of Hong Kong-listed China Mobile that will take part in the deal, the person said. "But how large a stake SASAC wants China Mobile to buy in ICBC is unclear," the person said.

The move is part of efforts by SASAC, which now oversees 138 of the country's biggest non-bank State-owned enterprises, to encourage cash-rich State-owned enterprises under its watch to "combine their industrial capital with financial capital", the person said, without elaborating.

Such a move may also be designed to prop up the shares of those Hong Kong-listed big State-owned banks, which have seen a spate of sell-offs by their foreign strategic investors in the past several months, analysts said.

Goldman Sachs sold 3.03 billion Hong Kong-traded ICBC shares earlier last month.

Allianz SE and American Express offloaded 3.216 billion and 638 million ICBC shares, respectively, in April.

(China Daily July 3, 2009)