"It's large, but it's likely to draw a big response from investors as one of China's big four [banks]," a fund manager said.

An initial price range of HK$1.42 to HK$2.27 per share, or 1.29 to 1.87 times 2005 book value, has been floated by the sale's book runners, according to fund managers. That means the final size of the offer could fall between US$4.8 billion and US$7.7 billion, a wide range by any measure.

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The deal is likely to close at the higher end of that range, bankers and fund managers said, perhaps in line with the 1.6 times book value that fellow mainland lender Bank of Communications fetched earlier this year. "CCB is larger but the quality of loans and return on equity are better at BoCom," one market observer said. China's fifth- largest lender, with one-third the assets of CCB, raised US$2.16 billion in June.

The biggest previous IPO in Hong Kong, China Unicom's 2000 debut, raised US$5.59 billion.

Formal price guidance will be set October 5 followed by an October 27 share sale.

The bank plans to sell 26.49 billion shares, or 12 percent of the enlarged share capital, and could sell up to 30.458 billion shares if demand warrants. The huge size of the IPO allowed the bank to cut the size of the retail offering to 5 percent from the normal mandatory 10 percent.

CCB plans to offer investors a 35 to 40 percent dividend payout, or a 2.9 to 4.6 percent yield in 2006.

While fund managers welcomed the move, the price per share is the key.

"The focus is on the share price because you're looking at shares in a Chinese bank and buying into China's growth story," a fund manager said.

Morgan Stanley, China International Capital Corp, the mainland's first investment bank, and Credit Suisse First Boston are arranging the sale.

Beijing hopes that by bringing in both strategic investors - typically foreign banks - as well as retail and institutional investors it can strengthen China's shaky banking system. The mainland's debt-burdened banks are likely to face tougher competition as limits on foreign financial institutions operations in China are eased beginning at the end of 2006 under the terms of China's accession to the World Trade Organization.

Bank of America, CSFB and the Singapore government investment arm Temasek have pumped a combined US$4.4 billion into CCB. Bank of America and Temasek committed a further US$1.9 billion to buying CCB shares in the IPO.