Bank of Beijing Co Ltd announced that it has been granted approval by the China Securities Regulatory Commission to establish a fund management company, the first of five urban commercial bank applicants in 2013 by Friday.

An announcement dated March 8 said the fund management will be jointly funded by Bank of Beijing, Bank of Nova Scotia and the Beijing-based General Research Institute for Nonferrous Metals.

Bank of Beijing is one of the five commercial banks that have been allowed to set up fund management companies under a pilot program approved by the State Council.

The other four are Industrial Bank Co Ltd, Bank of Ningbo Co Ltd, Bank of Nanjing Co Ltd and Bank of Shanghai Co Ltd.

China currently has eight fund management companies set up by commercial banks, among a total of 73 fund management companies in the country.

The China Securities Regulatory Commission said banks' increased participation in the pilot program will help to develop more channels for savings to be transferred in an orderly manner into the capital market, involving more institutional investors, boosting the development of the funds industry, and bringing more experience to the operation of urban commercial banks.