Harbin Bank of China is planning to apply for an initial public offering (IPO) in Hong Kong this month, according to people familiar with the situation. The unnamed sources also said the transaction is worth $1 billion, wrote The Wall Street Journal (WSJ).

The planned IPO makes way for a listing in the second quarter this year, said the sources. In the event that it gets approval from the stock exchange of Hong Kong, Harbin Bank will become the fourth Chinese Bank to debut in Hong Kong since the IPO surge that began in November, the report explained.

Chinese banks have been raising funds through Hong Kong IPOs. This is their way of recapitalizing amid stricter regulatory requirements. Bad loans have been increasing while the economy is slowing down, the report stated.

In December, China Everbright Bank raised $3 billion in an IPO in Hong Kong. The deal was the city's largest IPO for last year, WSJ reported.