China opened five industrial cities to overseas lenders one year ahead of a WTO timetable, as it eases restrictions on foreign expansion in the world's fastest-growing major economy.
Foreign banks will be able to apply to start doing yuan business with local companies in Harbin, Changchun, Lanzhou, Yinchuan and Nanning a year ahead of a Dec. 1 next year deadline for the reforms, the China Banking Regulatory Commission said in a statement released yesterday at its annual press conference in Beijing.
Shantou and Ningbo opened up to foreign lenders yesterday, as originally planned under the WTO pledges made in 2001.
US and European banks, including Citigroup Inc and HSBC Holdings Plc, are attracted by China's US$1.7 trillion household savings market, where 97 percent of assets are held by domestic lenders.
Foreign banks are targeting growth in credit cards and asset management to enhance brand awareness and increase revenue.
Yesterday's announcement brings to 25 the number of cities where overseas banks can do corporate business in the Chinese currency. The government is committed to removing geographic restrictions next December and allowing foreign banks to take deposits with local residents for the first time as part of agreement when it joined the WTO in 2001.
Overseas banks are seeking ways to expand in China, spending more than US$16 billion buying stakes in local banks to tap distribution channels for their financial products. China's four largest state-owned banks have at least 77,474 branches and 19 trillion yuan (US$2.3 trillion) of assets.
As of Sept. 30, 138 foreign banks have received approval to do yuan business, 15 can conduct online banking services and 41 foreign banks can trade derivative products.
Assets of foreign lenders reached a total of 550.7 billion yuan as of Sept. 30, making up about 3 percent of assets of China's financial institutions, according to the banking regulator.
Their bad loans stood at 160 million yuan, or 0.92 percent of total advances, at the end of September, compared with 1 trillion yuan, or 10.11 percent, of the nation's four biggest state banks.
‘ABUSE OF POWER’: Lee Chun-yi allegedly used a Control Yuan vehicle to transport his dog to a pet grooming salon and take his wife to restaurants, media reports said Control Yuan Secretary-General Lee Chun-yi (李俊俋) resigned on Sunday night, admitting that he had misused a government vehicle, as reported by the media. Control Yuan Vice President Lee Hung-chun (李鴻鈞) yesterday apologized to the public over the issue. The watchdog body would follow up on similar accusations made by the Chinese Nationalist Party (KMT) and would investigate the alleged misuse of government vehicles by three other Control Yuan members: Su Li-chiung (蘇麗瓊), Lin Yu-jung (林郁容) and Wang Jung-chang (王榮璋), Lee Hung-chun said. Lee Chun-yi in a statement apologized for using a Control Yuan vehicle to transport his dog to a
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The High Court yesterday found a New Taipei City woman guilty of charges related to helping Beijing secure surrender agreements from military service members. Lee Huei-hsin (李慧馨) was sentenced to six years and eight months in prison for breaching the National Security Act (國家安全法), making illegal compacts with government employees and bribery, the court said. The verdict is final. Lee, the manager of a temple in the city’s Lujhou District (蘆洲), was accused of arranging for eight service members to make surrender pledges to the Chinese People’s Liberation Army in exchange for money, the court said. The pledges, which required them to provide identification