CBRC to ease sub-branch requirements
Updated: 2009-10-10 08:30
By Joey Kwok(HK Edition)
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HONG KONG: The China Banking Regulator Commission will allow Hong Kong banks to open sub-branches in Guangdong province under the Sixth Supplement to CEPA.
Under the supplement, banks in Hong Kong that establish branch outlets in Guangdong may set up sub-branches within the province in any municipality without the need to first establish a branch in the same municipality, as previously required.
With this new provision, the capital requirement for setting up a sub-branch in Guangdong will be significantly reduced.
Hang Seng Bank, the largest Hong Kong-based commercial lender by market value, said Friday that it plans to apply within this month for approval to prepare for the establishment of its first "cross-location" sub-branch located in Foshan, Guangdong.
"The bank is seriously studying the opportunities for opening 'cross-location' sub-branches in other cities in Guangdong Province," said Margaret Leung, vice-chairman and chief executive of Hang Seng Bank.
Leung added that the initiatives under the supplement will help Hong Kong banks expedite their business expansion plans on the mainland.
Another Hong Kong lender Bank of East Asia also said Friday that its wholly-owned subsidiary Bank of East Asia (China) will submit applications for establishing "cross-location" sub-branches in Guangdong province.
"We will continue to extend our reach under Supplement VI to the CEPA to ensure that a greater number of customers throughout the Pearl River Delta can enjoy our comprehensive range of quality banking and financial services," said David Li, Bank of East Asia's chairman and chief executive, and chairman of Bank of East Asia (China).
Headquartered in Shanghai, Bank of East Asia (China) currently operates 68 outlets, including 18 branches and 49 sub-branches on the mainland.
Global banking giant HSBC, meanwhile, is also capitalizing on the opportunity to expand its branches across the country. The bank has recently moved its chief executive to Hong Kong to inaugurate its shift of business focus to emerging Asia.
HSBC Executive Director Peter Wong said the liberalization measure can enhance the status of Hong Kong as a regional financial centre, as well as provide local banks with excellent business opportunities in the Pearl River Delta region.
"We will proactively consider expanding our service points to different locations in the Guangdong province to enhance the quality and efficiency of banking services provided to individuals and enterprises on the mainland," Wong said.
(HK Edition 10/10/2009 page2)