Credit Suisse and Citigroup are vying for a joint venture with China's Founder Securities as global players seek a partnership in China's lucrative brokerage sector, state press said yesterday.
Credit Suisse has signed an initial agreement with Founder for a 33 percent stake in the joint venture, which will focus on investment banking business, the Securities Times reported.
But weeks ago Citigroup started similar talks with Founder, based in Hangzhou city of eastern China, making the final outcome of the venture talks uncertain, the report said.
China's flourishing financial service industry is one of the sectors that the US has been pushing China to open up more to foreign competition.
In the last round of China-US "strategic economic dialogue" in May, China has agreed to remove a barrier on the entry of new foreign securities firms and resume licensing securities companies, including joint ventures in the second half of this year.
The deal for the joint venture is expected to be submitted to China's securities regulator for approval in October, the report said.
China has also promised to allow foreign securities firms to expand their operations in the country to include brokerage, proprietary trading and fund management before the next round of the dialogue this year.
There are only three securities joint ventures approved in the country, including Morgan Stanley's venture with China International Capital Corp, Goldman Sachs Gaohua Securities and UBS' venture with Beijing Securities.
Credit Suisse and Citigroup officials declined to comment.