The China Construction Bank (CCB) has announced an incentive plan to allow about 270,000 employees to acquire 800 million of its shares starting July 6, according to a statement issued by the bank.

 

Under the plan, employees working for more than three years and other individuals approved by the board or the senior management are able to buy or be given shares, which they must held for at least three years before selling them.

 

The plan will be administered by an independent trustee, said the statement.

 

Shares purchased by employees are priced at around 3.6 yuan, compared with the current share price of HK$5.85 (5.7 yuan), Sunday's Beijing Morning Post quoted sources as saying.

 

The plan aims to "increase employees' sense of belonging to the company and to attract and retain employees to serve the bank over the long term", according to the statement.

 

However, as employees are only entitled to buy shares worth five to 10 percent of their annual salary for the previous year, grass roots employees can only get a few hundred shares, said the newspaper.

 

The plan has got the nod from national regulators, said insiders.

 

The CCB, which has a total of about 225 billion shares, is the first of the "Big Four" to offer such a scheme. The three other state-owned commercial banks are the Industrial and Commercial Bank of China (ICBC), the Bank of China (BOC) and the Agricultural Bank of China (ABC).

 

The Bank of Communications has already taken the step. China Merchants Bank, China Minsheng Banking Corporation and Shanghai Pudong Development Bank are all mulling similar plans.

 

The CCB's adjusted net profit rose 18 percent to 46.3 billion yuan (US$6 billion) in 2006.

 

(Xinhua News Agency July 9, 2007)