SHANGHAI, August 15, 2008 (AFP) - French lender BRED Banques Populaires has agreed to buy a stake of no more than 20 percent in a Chinese city commercial bank for 200 million yuan (29.2 million dollars), a local banking industry group said.

Paris-based BRED and Changshang Commercial Bank of Hunan province in central China signed an agreement for the tie-up in June, the Hunan Provincial Banking Association said in a statement on its website.

The Chinese lender plans to list shares on the stock market after the introduction of a foreign strategic investor, the statement said, without providing more details.

Officials with Changsha Commercial Bank were not immediately available for comment. The lender, established in 1997, mainly operates in Changsha city, the capital of Hunan province.

As of the end of 2007, the lender's outstanding loans totalled 19.2 billion yuan and deposits were 40.1 billion.

Its nonperforming loan ratio was 2.97 percent, slightly lower than the average 3.04 percent for city commercial banks. The bank booked an operating profit of 640 million yuan last year.

Several Chinese city commercial banks including Bank of Nanjing, in which BNP Paribas holds a 12.6 percent stake, have already listed on the domestic stock market after stake-sale to foreign strategic investors.