In their rush to raise cash, U.S. banks and private equity shops are paring back their holdings in China's banks. And with Chinese stocks up 55% this year, they're not having to settle for fire-sale prices. Goldman Sachs (GS) bagged $1.9 billion on June 2 when it sold less than 1% of ICBC, while Bank of America (BAC) pocketed $7.3 billion last month for 5.6% of China Construction Bank. Next in line to cash in is Newbridge Capital, the Asian arm of private equity house TPG, which is in talks to sell part of its 17% stake in Shenzhen Development Bank, now worth $1.5 billion—roughly 10 times what Newbridge paid in 2004. The bonanza for foreigners may not sit well with Beijing higher-ups, who have watched the value of China's stakes in Wall Street firms shrivel.
See "Foreign Banks Reap Handsome Profits Cashing Out of Chinese Banks"