The China Securities Regulatory Commission (CSRC) has granted Standard Chartered (SC) in-principle approval to arrange a securities agency in Mainland China, following the nation’s elevate of possession restrictions for international monetary establishments in 2020.
Foreign banks current in China’s securities market through joint ventures (JV) had been fast to extend their shareholding above 50% after the foundations had been eased. In August 2021, JP Morgan turned the primary to take 100% possession of the securities agency that it had arrange as a JV with Shanghai International Trust Corp in 2004. Goldman Sachs followed swimsuit, in October 2021.
SC would be the first financial institution to arrange a completely international owned securities enterprise through greenfield funding, learn the announcement distributed to media final week. SC will make an preliminary capital injection of RMB1.05 billion ($154.7 million).
The new securities agency might be primarily based in Beijing and can supply underwriting, asset administration (restricted to asset-backed securities), own-account buying and selling and brokerage companies for each onshore and offshore shoppers.
The financial institution introduced its appointment of John Tan, head of economic markets for Asia, as chair-designate of the brand new agency, and Grace Geng as CEO-designate. Geng’s LinkedIn profile reveals that she was appointed by the financial institution in August 2021 as a part of the setup challenge.
SC’s CEO for Asia, Benjamin Hung, stated within the media launch that the agency was “confident of the continued opening of financial markets in China,” and “very positive about the country’s development prospects, in particular the promising investment value of the onshore capital markets and the growing attractiveness of renminbi assets in offshore markets.”
Jerry Zhang, who serves as govt vice chairman and CEO for China, and cluster CEO for China and Japan, added: “As China continues to open up its capital markets rapidly, the importance of Chinese assets in the global markets keeps growing while the efficiency of its resource allocation is also improving.”
London-headquartered SC Bank set up its first China department in Shanghai in 1858. In its 2021 annual outcomes report, the financial institution introduced plans to take a position $300 million over three years in China-related companies to assist shoppers handle alternatives rising from China’s opening up, together with forex liberalisation, the Belt and Road initiative, the Greater Bay Area (GBA), onshore capital markets, and mainland wealth.
A spokesperson for SC declined to remark past the discharge.
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