(Yicai Global) Jan. 14 -- Bank of Nanjing said it plans to buy a controlling stake in a financial institution in which the lender is already a shareholder. The target firm may be Suning.Com's consumer finance unit, online news outlet The Paper reported today, citing an unidentified source familiar with the matter.

The bank’s board has passed the proposal, the Nanjing-based lender said in a statement late yesterday, but it still needs official sign-off, after which it will require regulatory approval. It did not name the target company.

Suning Consumer Finance was set up in May 2015 by five backers, including Bank of Nanjing, which has a 15 percent stake. The bank also has a seat on the board, giving it considerable clout at the consumer loans company.

The other founders were Nanjing-based e-commerce giant Suning, with a 49 percent stake, Xiansheng Zaikang Jiangsu Pharmaceuticals, BNP Paribas Personal Finance, and Jiangsu Yanghe Brewery Joint-Stock.

Caught in a liquidity crisis, Suning brought in strategic investors including Jiangsu province state-owned assets and industrial capital twice last year, raising more than CNY12 billion (USD1.9 billion). Founder Zhang Jindong stepped down as chairman last July.

Bank of Nanjing also disclosed other news. The board passed a proposal to issue up to CNY20 billion of perpetual bonds yesterday to replenish first-tier capital. Last December, it green lighted the sale of as much as CNY40 billion in bonds.

The bank had about CNY1.71 trillion (USD269.1 billion) of assets as of last September, an almost 13 percent increase from December 2020. Debt also climbed nearly 13 percent to CNY1.59 trillion. Its capital adequacy ratio was 13.28 percent as of last June, down 1.47 point from the end of 2020.

Shares of Bank of Nanjing [SHA: 601009] closed down 3.3 percent today at CNY9.48 (USD1.50) each, while Suning [SHE: 002024] slid 3.3 percent to CNY4.12.

Editor: Emmi Laine, Xiao Yi