China Development Bank (CDB) has paid 2.2 billion euros for 201.39 million new ordinary shares in Barclays, the London-based bank said.

Barclays said late on Tuesday it had issued the shares to CDB as well as 135.42 million new ordinary shares to Temasek Holdings for 1.4 billion euros, in line with a deal announced on July 23.

The shares were bought at the agreed price of 7.2 pounds per share. The purchases give CDB a 3.1 percent stake in Barclays' existing share capital and Temasek 2.1 percent.

The funds are additional capital for Barclays' ongoing bid for Amsterdam-based ABN Amro.

It is the first time State-backed CDB has been involved in an international buyout of a large financial institution.

Under the deal, if Barclays outbids its competitor Royal Bank of Scotland (RBS) and wins ABN Amro, CDB will make a further investment in Barclays of up to 6.34 billion euros.

The initial 2.2 billion euros was mainly in cash and raised within the Chinese bank, John Studzinski, senior managing director of Blackstone, told China Daily earlier. Blackstone is advising CDB on the Barclays deal.

The 2.2 billion euros is almost equal to the lender's total profit last year of 28 billion yuan.

CDB had total assets of 2,314 billion yuan at the end of 2006. The bank is awaiting an injection of at least US$20 billion from state-owned Central Huijin Investment Corp as it seeks to become a commercially driven bank.

The bank's net asset value will increase from 158 billion yuan to 300 billion yuan or more after the Central Huijin boost.

"But there is no clear timetable for the Central Huijin investment," said a source, who declined to be named.

CDB might raise capital through a bond sale to fund further investment in Barclays, Caijing Magazine said yesterday.

(China Daily August 16, 2007)