Singapore’s state investor Temasek is reported to have been in talks with a unit of Bank of China to launch a US$1bn-2bn investment fund that will focus on China infrastructure projects.

The initiative was said to have been taken by BOC International, the investment banking arm of Bank of China. Talks were in their early stages but the two sides had agreed on the general idea of the fund scheme, according to sources with direct knowledge of the plan.

The fund’s aim would be to tap into investment opportunities emerging from China’s Rmb4,000bn economic stimulus package launched late last year.