Nine non-state companies on Monday became shareholders in the Wenzhou Commercial Bank, based in the city of Wenzhou, east China's Zhejiang province, breaking the state's domination of the bank's capital framework.

With the introduction of private shareholders, the total equitycapital of the bank rose from 290 million yuan (US$35 million) to 509 million yuan (US$61.3 million) while the state holds a smaller stake than before, said the bank source.

The state used to hold 34.42 percent stake in the Wenzhou Commercial Bank and this has been reduced to 7.94 percent.

Private capital accounted for 67.78 percent of the bank's shareholdings, up from 22.96 percent, and each private shareholdernow holds a stake of at least 7.84 percent, up from less than one percent.

The deal would act as a trial for joint-stock commercial banks to shift from a state-dominated to a more flexible and diversifiedframework, said Xia Ruizhou, chairman of the board of the bank.

Of the nine new shareholders, seven are on the board of directors and two on the board of supervisors.

Wenzhou was selected by the central bank, the People's Bank of China, to be the only pilot city for the country's banking reform.

(Xinhua News Agency July 30, 2003)