SHANGHAI, Aug. 22 -- THE Bank of Beijing may become the third city-level commercial bank on the mainland, after the Bank of Nanjing and Bank of Ningbo, to raise funds by going public, the Shanghai Securities News reported today.

The bank has issued and IPO application to the China Securities Regulatory Commission stating it wants to issue yuan-denominated A-shares on the Shanghai Stock Exchange. The application will be reviewed on August 27, according to the report.

The bank, which is 19.9 percent owned by ING Groep NV, hopes to raise about 13 billion yuan (US$1.7 billion) from the IPO in order to compete with larger domestic and overseas rivals.

The bank plans to sell 1.2 billion A shares, or 19.27 percent of its total shares, said the report. Each share would be priced at 1.96 yuan before listing.

Established in 1996, the Bank of Beijing is China's largest city-level commercial bank. It accepted investments in 2005 from Dutch ING Groep NV and IFC, which holds five percent of shares in the bank.

Meanwhile, the bank's board of directors has approved its employees to sell a combined of 36.67 million shares at 1.95 yuan a share, to a specific shareholder of the bank.

The board chairman, the deputy board chairman and the president are allowed to sell no more than 100,000 shares each.

Beginning from the listing date, ING, the bank's largest shareholder, will not have the power to nominate board chairman, members of the board of directors and senior officials or veto right over naming of the bank's auditor.

ING has also promised that it won't buy shares after the bank is listed. Consequently, it will own 16.07 percent of the bank, rather than the current 19.9 percent.

However, ING has first priority in purchasing the bank's IPO shares in possible future overseas markets to maintain its stake in the bank.

By the end of March, the bank had an estimated of 263.98 billion yuan in assets, with 10.32 billion yuan of shareholder's equity. Its capital adequacy ratio was 13.23 percent.

Early last month, Bank of Beijing was given the go-ahead to start a branch in Shanghai -- the bank's second venture outside the nation's capital, after its Tianjin branch opened in November last year.

Officials said the bank's strategy in Shanghai is to target small and medium-sized enterprises as well as individual accounts.