Bank of China, the country's second-largest bank, is set to raise $8 billion next month in an initial public offering (IPO) in Hong Kong that bankers say could reignite a debate over whether it is right for China's big lenders to list overseas.

Broaching the controversy, Jiang Dingzhi, vice-chairman of the China Banking Regulatory Commission, told political and business leaders that banks would continue to raise money overseas but would also issue shares on domestic stock markets.

"Some banks have chosen to go public overseas. This was their own decision, based on their circumstances. But I believe that, as China's financial markets develop, more and more banks will raise funds at home," he said at the Boao forum, an annual gathering on Hainan island off China's south coast.

A nationalist backlash unfurled after China Construction Bank (0939.HK: Quote, Profile, Research) sold $9.2 billion worth of shares in Hong Kong last October in a record offering for a mainland company.