The new company, named the Industrial and Commercial Bank of China Limited, will assume all business and relevant assets and debts of the former ICBC, with registered capital of 248 billion yuan (US$30.6 billion).

Each of the two sponsors -- the Ministry of Finance and Central Huijin Investment Co. Ltd., a central government investment arm that supports China's aggressive financial reform -- holds a 50 percent stake.

Newly-appointed president Yang Kaisheng of the ICBC Ltd. told the press the bank would go public at an "appropriate time" next year, but has not decided on where to list. "The decision should take into consideration the scenario of capital markets and our bank's development."

Even as a shareholding company, ICBC Ltd. is now still 100 percent state-owned, but Yang said the bank's share structure will be adjusted as more sophisticated foreign investors will be invited to help upgrade its operation.

The ICBC Ltd. is already in talks with potential strategic investors and is likely to have a number of buyers, he said, predicting that the state, however, would hold the lion's share "in the long run".

China is overhauling its Big Four state banks, which also include China Construction Bank (CCB), Bank of China (BOC) and Agricultural Bank of China (ABC), before it fully opens its banking industry to foreign competition by late 2006 under commitments made as a part of its entry into the World Trade Organization.

The debt-ridden banks are required by the government to become "commercial banks in a real sense", by establishing shareholding systems, inviting strategic investors and then seeking public listings.

Decades of government-ordered, ill-advised lending to state-owned companies have piled up a mountain of debts at Chinese banks and weakened their management, analysts say.

On Friday, the ICBC Ltd. said its boards of directors, supervisors and senior management have been set up. "Standard corporate governance has taken initial shape."

Three people, including a former financial secretary of Hong Kong, will work as independent directors for the bank.

Yang Kaisheng said the ICBC Ltd. will not reduce its staff heavily when it continues its joint-stock reform and as a listed company though it is eyeing growth of per capita profit. The bank now employs as many as 360,000 people.

"We will properly handle various kinds of internal relations," he said.

The bank, China's biggest assets-wise, boasts more than 21,000 business outlets in China's mainland, serving more than 8 million enterprises and more than 100 million individual clients.

Its capital adequacy ratio, or a measure of its available capital in proportion to its outstanding loans, rose to 10.26 percent at the end of September, already above the 8 percent requirement by the international standard. Its non-performing loan ratio stood at 2.59 percent.

CCB made its debut on Thursday on the Hong Kong Stock Exchange. BOC is anticipated to sell share to private investors early next year. ABC, with the most serious bad debt problem, has been keeping a low tone on its reform plan.