China' Foreign Exchange Agency buys 1.6% stake in Total

China's Foreign Exchange Agency, which manages China's US$1,650 billion in foreign exchange reserves, has bought a 1.6% stake in France's Total SA, the third largest oil company in Europe, market sources reported.

The State Administration of Foreign Exchange has built up a EUR 1.8 billion staking in Total, according to a person close to the company.

The Chinese agency is now gearing up to diversify its portfolio, buoyed by the falling US currency, as it usually focuses on investment in low-yielding securities, such as Treasury bonds and mortgaged-backed securities, the Financial Times reported.

Albert Frere, the Belgian entrepreneur, is the biggest single shareholder in the oil company, while employees hold 4%, according to sources.

Han Yuting, a spokesman for the Chinese foreign exchange regulator, is not immediately available for comment.