China bank angles for Bear Stearns stake

Discussion in 'Stocks' started by ASusilovic, Aug 10, 2007.

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    Beijing-backed CITIC Group is negotiating for a minority stake in Bear Stearns Cos. Inc. as investors worry about a sharp downturn in the U.S. investment bank's fixed-income and mortgage-related revenue, Forbes magazine reported on Thursday. The story in Forbes follows other reports about negotiations between Bear Stearns and the Chinese financial conglomerate. CITIC and Bear Stearns were not immediately available for comment.

    A strategic partner would give Bear Stearns added liquidity as Wall Street investment banks weather a credit crunch and the prospect of sharply lower fixed-income revenue during the second half of the year. Turmoil at Bear Stearns would allow CITIC to get a stake at a big discount because Bear shares are down 26 percent this year.