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CRH (China Railway High-Speed) trains are cleaned at the new Wuhan Railway Station in Wuhan, China, on Tuesday, Feb. 2, 2010. [CFP]

Bank of China (BOC) is likely to invest some 6.6 billion yuan in Beijing-Shanghai High-Speed Railway Corp, the operator of the 1,318 km express rail link being built between the country's most affluent cities, people familiar with the matter said.

The nation's third largest lender by market value plans to buy 6 billion shares from China Railway Investment Corp (CRIC), the largest shareholder of the Beijing-Shanghai high-speed railway operator, at about 1.1 yuan per share, the sources, who declined to be named, told China Daily.

CRIC, currently holding 56.2 percent of Beijing-Shanghai High-Speed Railway Corp, said in February that it intended to shed a 4.5 percent stake to raise about 6 billion yuan for the purpose of funding other rail construction projects.

The deal has won the approval from the banking regulator and will be completed through BOC's Hong Kong-based investment arm - Bank of China Group Investment Ltd, the sources said, adding that BOC will file the announcement of the deal to the stock exchange on March 30.

Analysts said the move marked a breakthrough for commercial banks investing in non-financial entities.

With an eye on the stable and lucrative returns from railway investments thanks to China's monopolized state-run railway operation, the nation's top lenders, including Industrial and Commercial Bank of China, China Construction Bank and Bank of China expressed a keen interest in investing in Beijing-Shanghai High-Speed Railway Corp prior to its establishment at the end of 2007. However, the banking regulator banned a planned share acquisition at the time.

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