Agricultural Bank of China (ABC) has selected five foreign investment banks to underwrite its long-awaited initial public offering (IPO) in Hong Kong after holding a "beauty contest" among potential candidates, a source familiar with the matter told China Daily on Wednesday.

The five banks that won the bid of ABC's H-share underwriting mandate are Goldman Sachs, UBS, Morgan Stanley, Deutsche Bank and Macquarie, according to the source.

JP Morgan is still in discussions with ABC and may also win a role, the source said. The bank declined to comment on the issue.

The selected banks might be paid an underwriting commission at the rate of 1.5 percent or 2.5 percent, but a final rate decision is still being negotiated with ABC as no underwriter would want to miss out on what could be the largest IPO in history, the source said.

ABC, the country's third-largest lender by assets, is the last State-owned bank to float shares. It is likely to raise around $22 billion from the IPO in Shanghai and Hong Kong, surpassing the Industrial and Commercial Bank of China's IPO in 2006, which raised around $21.9 billion.

The lender was still consulting with its underwriters on the best timing for the listing, the source said. Sources told China Daily earlier the bank is likely to launch the IPO in June or July.

Citic Securities and China International Capital Corp are the forerunners to underwrite ABC's Shanghai listing, according to Chinese media reports.

The lucrative underwriting mandate of ABC has attracted the interest of foreign investment banks that have spent the past three years lobbying to win a role in this mega IPO.

Foreign banking chiefs including Morgan Stanley Chairman John Mack and its CEO James Gorman have visited Beijing several times over the past three months.

Brian Moynihan, CEO of Bank of America Merrill Lynch, also paid a visit to Beijing last month.

Overseas underwriters are generally chosen for their experience in handling similar IPOs including those of ICBC and China Construction Bank, a source close to ABC said.

Eligible candidates are also required to be capable of introducing overseas funds and clients for investment and have a reasonable commission rate, the source said.

ABC's planned IPO was delayed on the regulator's concern about its weak asset quality and high ratio of non-performing loans as it has been largely providing financial services to rural areas and the agricultural sector.

But foreign bankers said investors are optimistic about the IPO's prospects as the bank may benefit from the government's policy to boost economic development in rural areas.

"Based on feedback from our investors, interest in ABC's IPO is high because of its State-owned background and the government's favorable rural policies that the bank may benefit from it," said a foreign investment banker involved in the IPO underwriting.