ABN Amro is interested in buying a stake in Huishang Bank Co and becoming a strategic partner with the regional Chinese lender, Jeroen Drost, chief executive of ABN Amro, said in Shanghai over the weekend.

The Dutch bank would be interested in a strategic relationship with Huishang Bank under terms and conditions acceptable to both sides, Drost said on Saturday.

Huishang Bank was formed in late 2005 from the merger of Hefei City Commercial Bank, five city commercial banks and several smaller credit cooperatives in eastern Anhui Province. The bank has 180 outlets with 3,400 employees.

An overseas investor can hold no more than 20 percent of a local bank under Chinese regulations.

The Netherlands-based ABN Amro also plans to add six new outlets in China's mainland this year and expand its network by six to 10 outlets in 2008, depending on the pace of regulatory approvals. The bank now has 14 branches on the mainland.

The bank is one of 12 overseas lenders that have applied to incorporate in Shanghai. The status, which requires registered capital of at least one billion yuan (US$131 million), enables such lenders to offer a full array of retail yuan services to Chinese.

The Dutch bank has re-applied to China's banking regulator by more than tripling registered capital to four billion yuan from a previously planned 1.3 billion yuan.

ABN Amro will hold a briefing tomorrow about progress on incorporating locally. The bank is likely to announce it received regulatory approval.

The Dutch bank is the subject of a heated takeover battle between a consortium, including Royal Bank of Scotland Group, and Britain's Barclays.