UPDATE 1-China’s big five banks rise on draft deposit insurance rules

(Updates with others banks, adds context)

Dec 1 (Reuters) – Mainland listed shares in China’s big five banks jumped on Monday but later pared gains, after the country issued draft regulations to introduce a bank deposit insurance scheme for the first time.

Offshore investors also reacted cautiously to the news, with the banks’ Hong Kong listed shares falling.

Industrial and Commercial Bank of China Ltd , the country’s largest lender, rose more than 2 percent in Shanghai, before easing to trade flat, while Agricultural Bank of China Ltd retreated from a high up more than 3 percent to trade little changed.

China Construction Bank Corp held on to gains after opening up 1.9 percent and Bank of Communications Co Ltd , the country’s fifth largest lender, was up nearly 3 percent.

The move on Sunday was the latest in a series of steps to liberalise interest rates and allow banks to compete on a fully commercial basis.