Shanghai Pudong Development Bank to sell preference shares

Shanghai Pudong Development Bank on Tuesday announced a plan to issue preference shares, the second company to do so since regulators gave the greenlight to the new type of funding.

The company said it will sell no more than 300 million shares to raise no more than 30 billion yuan ($4.92 billion), according to its statement filed with the Shanghai Stock Exchange.

Money raised will help replenish the bank's tier one capital.

China is pushing for reform in the capital market to create more financing channels. The China Securities Regulatory Commission (CSRC) in March allowed pilot projects on preference shares. H Last Thursday, Guanghui Energy Co. Ltd. became the first to announce a plan to issue preference shares .

Preference shares and common shares are the two primary types of stocks that companies offer to investors. Preference share holders have priority rights over ordinary share holders in distribution of profits and residual assets, but they usually do not have voting rights.