HSBC Holdings Plc and Standard Chartered Plc received licenses to conduct local currency business with Chinese companies in Beijing, the first overseas lenders to gain greater access to the nation's capital.
The Beijing branches of HSBC, Europe's largest bank by market value, and Standard Chartered, which derives two-thirds of its profit in Asia, won approval from the China Banking Regulatory Commission, the lenders said in separate statements.
China on Dec. 1 increased the number of cities where overseas banks can do yuan business from 13 to 18, including Beijing, where 4,551 companies are registered, according to government data. Their ability to lend is constrained because they can only take deposits from foreigners and borrow a limited amount of money from Chinese banks to fund loans.
"The market is opening up for the foreign banks, but only gradually," said Simon Ho, a Hong Kong-based banking analyst at ABN Amro Asia Ltd.
Foreign banks will be quite slow to expand the local corporate business because the risks are higher and the cost of funds is greater, he said.
In two years, China will allow HSBC, Citigroup Inc and other banks to conduct business with its 1.3 billion individuals, who had savings of USUS$1.5 trillion as of Nov. 30.
London-based HSBC said it will also be allowed to open a sub-branch in Beijing in the first half of next year, to be located in the city's Chaoyang district.
Nine overseas banks applied to conduct yuan business in Beijing, a spokesman for the China Banking Regulatory Commission said, without elaborating. The commission will grant more licenses "soon," he said, asking not to be named.
HSBC, founded in Hong Kong and China in 1865 to finance British trade in goods such as silk and tea in Asia, owns stakes in the nation's Bank of Communications and Bank of Shanghai.
The bank's profit in China more than doubled to 324.7 million yuan (US$39 million) last year from 156.1 million yuan in 2002. Hongkong & Shanghai Banking Corp, the Asian arm of HSBC, reported profit of US$3.3 billion for last year.
The license "will allow us to significantly strengthen our presence in China's capital city," said Dicky Yip, chief executive of China business at HSBC, in the statement last on Friday night.
"Beijing's yuan market offers an area of potential growth for us." HSBC's loans in China gained 52 percent to 21.3 billion yuan last year, while total assets climbed 69 percent to 32.2 billion yuan, the bank said in April. Outstanding local currency loans in China amounted to 16.9 trillion yuan at the end of July, according to central bank data.
Standard Chartered, which agreed to buy a fifth of Bohai Bank, a new Chinese lender, also applied for yuan licenses in the cities of Xiamen and Tianjin, Martin Fish, chief executive of its China business, said on Dec. 1. The bank has eight branches in China.
China also gave overseas banks the same business opportunity in Kunming, Xian and Shenyang as part of its obligations to the World Trade Organization.
HSBC also said it won approval to upgrade its representative office in Chongqing, southwest China, to a full branch, bringing its total network to 11 outlets.
Beijing, with a population of 13.8 million, had 4,551 state-owned and other companies operating in the city, according to the National Statistics Bureau's Web site.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last