China National Petroleum Corp. (CNPC) and two subsidiaries proposed a joint capital increase with a total investment of more than 22 billion yuan ($3.18 billion) in its financial service unit CNPC Finance, according to a statement by its Hong Kong-listed subsidiary PetroChina Co. Ltd. Thursday night.

An industry expert told Caixin the move would enable the finance subsidiary to improve CNPC’s group-level capital planning. The capital injection will boost CNPC Finance’s registered capital from 8.33 billion yuan currently to 20 billion yuan. CNPC was established in 1995 with a registered capital of 800 million yuan.

According to the Thursday statement, around 8 billion yuan of the increased capital will be converted directly from the current capital reserve of CNPC Finance to registered capital, while the rest will be offered in cash by the three shareholders — CNPC, CNPC Capital, and PetroChina. CNPC owns 40% of the finance unit; CNPC Capital, 32%; and PetroChina, 28%. The proportions will remain unchanged after the proposed increase.

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Contact reporter Isabelle Li (liyi@caixin.com)