Bank of China has acquired a 20 per cent stake in France-based private bank La Compagnie Financiere Edmond de Rothschild, in a move to expand the Chinese bank’s exposure to European private banking, according to media reports.

Under the deal, Bank of China will acquire a stake for €263.3 million ($377.9 million). Bank of China, the world's fifth-largest bank by market value, said it aims to bolster its European product expertise and distribution capacity in private banking and asset management.

Edmond de Rothschild will significantly expand internationally by gaining access to investors in one of the world's fastest-growing economies.

" China is experiencing an economic big bang that is comparable to the United States in the 20th century," Michel Cicurel, chief executive of the French bank, said.

Zhu Min, group executive vice president at Bank of China, said Chinese banks need to internationalise and expand their product knowledge.

After the investment, BOC will become the second largest shareholder in the bank. The controlling shareholder, Benjamin de Rothschild, will hold 74.19 per cent.

Completion of the investment is conditional on the parties obtaining regulatory approvals. The two banks will also cooperate on asset management opportunities in selected regions outside China and France, and on potential joint investments in private equity globally.