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China's social security fund to invest in ICBC

China's National Social Security Fund (NSSF) is set to invest over $2.25 billion in the Industrial and Commercial Bank of China (ICBC), the nation's largest domestic bank has announced.

In a statement, ICBC said that the strategic investment agreement had been signed in Beijing, but that regulatory approval would be required for it to proceed.

It will see the NSSF form a partnership with ICBC in the development and running of the bank's fund management operations, with the security fund - which manages some $26 billion in assets - taking a sizeable stake in ICBC.

The size of the stake, however, has not been disclosed.

The move will bring the prospect of an initial public offering (IPO) in Hong Kong a step closer for ICBC, with bank officials estimating that as much as $12 billion could be raised when shares go up for sale.

The bank has also said that it will sell shares on the Chinese stock market once the Hong Kong IPO has been completed.