Bank of China Hong Kong (BOCHK) has agreed to sell 70.5% of its stake in its wholly-owned subsidiary Chiyu Banking, following a review of its operations.

Founded by Chen Jiageng, Chiyu Banking has been registered as the 39th licensed bank in Hong Kong since 1947. The lender operates 24 branches in Hong Kong, one branch and two sub-branches in Xiamen and one branch in Fuzhou.

The disposal of Chiyu Banking is subject to approval from the regulatory authorities of the People's Republic of China.

The two entities in a joint statement said that the disposal would be consistent with the long term development strategy of the group in the Hong Kong region, which would enable a better allocation of resources of the Group.

For the third quarter ended 30 September 2016, BOCHK reported its operating profit before impairment allowances HK$7.4bn ($942m), a decline of 10.5% compared to same period in 2015.