Previous high profile Chinese listings have enjoyed double-digit bounces on their first days of trading.

The weaker than expected start also reflects the difficult time that may lie ahead for a market that will be asked to absorb several more big fund raising issues by banks.

China is on track to be the world's biggest IPO market this year with up to 300 companies expected to raise 500 billion yuan (almost $74bn) this year, according to PricewaterhouseCoopers.

'Important step'

Declaring the start of trade in AgBank shares on Thursday, chairman Xiang Junbo called the IPO an "important step" towards the bank becoming a "global, first-class commercial" institution.

"We are relatively satisfied with today's stock prices, which reflect investors' positive views on AgBank's current status and outlook," Zhang Yun, the bank's president, said shortly after trading began.

Shares in AgBank will debut on the Hong Kong exchange on Friday, where the bank said its IPO had been nearly six times oversubscribed.

It said in a statement that it had received a total of 117,176 bids for 7.46 billion shares by the July 6 application deadline, equivalent to about 5.87 times of the total number of shares initially available for the Hong Kong part of the offering.

However it has yet to indicate whether it will sell additional shares under over-allotment options in the listing - a key factor in determining whether it sets an IPO record.

The lender drew almost a dozen heavyweight cornerstone investors for its Hong Kong listing, including Qatar's sovereign investment fund, Britain's Standard Chartered bank and Hong Kong's richest tycoon, Li Ka-shing.