Bank of China (BOC) has gained approval to raise up to 20 billion yuan (about 2.9 billion U.S. dollars) or the equivalent in foreign currency through the sales of preference shares overseas.

The China Banking and Insurance Regulatory Commission has approved the bank's plan to issue no more than 200 million preference shares in the overseas market, the Bank of China said in a statement.

Earlier data showed the non-performing loan ratio at BOC was 1.42 percent by the end of 2018, down 0.03 percentage points from the end of 2017.

Preference shares, along with common shares, are two primary types of stocks that companies offer to investors. Preference shareholders have priority rights over ordinary shareholders in the distribution of profits and residual assets.

Unlike common shares, preference shares function more like a bond. They are rated by major credit-rating companies and their prices are affected by changes in interest rates. 

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