Foreign banks aim higher in Shanghai
Updated: 2008-01-14 11:25
Their local status has prompted foreign banks to use their overseas expertise to capitalize on the city's financial sector. Foreign banks made an obvious impact in the area of wealth management with their broad range of products.
The American bank Citigroup began offering insurance-linked investment products that target children and teenagers between 30 days and 17 years old. The yuan-denominated product, launched in October, is the first of its kind offered in the country.
Meanwhile, the British-based Standard Chartered, known for its lending business to small- and medium-sized enterprises, launched an unsecured personal loan business in China.
HSBC has exhausted its $500 million quota under the QDII scheme, and has been granted another $500 million quota by the State Administration of Foreign Exchange, showing the authority's confidence in Europe's largest bank.
Bank of East Asia provides investors with premium wealth management products on the back of its experience in the Hong Kong market.
A total of 27 banks in Shanghai had put forward wealth management services as of the end of June, including five large banks, nine small-to-medium-sized players and 13 foreign institutions. The outstanding value of the wealth management products totaled 61.7 billion yuan, a year-on-year jump of 53 percent.
Foreign players have been active in the fledgling market for financial derivatives, which has now become one of Shanghai's main development thrusts as it becomes a major international financial center.
According to a report provided by the Shanghai branch of CBRC, the outstanding nominal value for derivatives transactions at the city's banks surged 128 percent year-on-year to 714.8 billion yuan during the first half of 2007, with foreign banks in Shanghai generating nearly 145 percent growth.
"The rapid development of derivative transactions reflects the strengthening innovation ability of Shanghai's Chinese and overseas banks," the banking watchdog said.
Foreign banks are still looking to tap into the lucrative credit card market. So far the city has seen nine domestic lenders set up credit card centers in Shanghai.
"We now have more than 2,000 consumer banking employees in China, and expect to grow that to 3,200 in 2008," Standard Chartered Bank says. "We are going to increase our branch network to 65, and bring ATMs from 100 to around 190 next year.
"We want to be recognized as the best-managed consumer bank in China by 2011."
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