Mumbai: The Industrial and Commercial Bank of China (ICBC), the country's biggest bank, has received regulatory approval to buy a 20 per cent stake in South Africa's Standard Bank, the largest commercial bank in Africa.

The $5.46 billion deal, already approved by shareholders of both banks and regulators in South Africa, received approval from the China Banking Regulatory Commission as well, ICBC officials said.

The acquisition would make ICBC the biggest single shareholder in the Johannesburg-listed Standard Bank

Standard Bank has 1,501 branches with presence in 18 African countries and major financial centres in Europe, North America and Asia.

ICBC officials, meanwhile, said the bank is likely to complete another acquisition deal in 2008. They also said ICBC was looking at American financial institutions, battered by the sub-prime mortgage crisis, "if such a deal facilitates our strategic development."

ICBC said it is allocating a 30 per cent risk reserve to cover possible losses in its subprime assets. The bank held subprime assets of $1.2 billion.

The bank said its subprime holdings remained stable but risk reserves had been increased in the fourth quarter after supervisory departments issued warnings of a possible deterioration in the subprime crisis.

In its third quarter report, ICBC said it held subprime mortgage bonds of $1.228 billion, for which it had allocated 429 million yuan (about $61 million) in risk reserves.

Bank of China (BOC) and the ICBC are believed to be the top two investors in the US subprime mortgage market.

ICBC is still on the trail of a 19.3 per cent stake in Thailand's ACL Bank, even though the Thai bank postponed the sale.

ACL's stake sale awaits promulgation of Thailand's new commercial law in 2008, which is expected to raise the stake foreign-funded enterprises may hold from 25 per cent to 49 per cent, reports said.

ICBC also agreed to acquire a controlling stake in Indonesia's Halim Bank in December 2006 and Macao's Seng Heng Bank in August 2007.

ICBC overtook Citigroup in July 2007 as the world's biggest bank by market capitalisation.