The 54 overseas banks with branches in Shanghai injected a combined
US$528 million into their capital bases last year, to bring their
total registered capital to US$1.537 billion, according to a report
published yesterday by the People's Bank of China.
The report doesn't say how profitable overseas banks in the city
are, but according to an earlier PBOC report the banks earned
US$60.8 million in pre-tax profits during the first six months of
2002.
"During the first year after China's entry into the World Trade
Organization, overseas banks were actively carrying out a wider
range of banking services to enlarge their presence in the local
market," said yesterday's report.
During its bid to enter the World Trade Organization, China
promised to gradually open its banking market to overseas investors
by 2006. But foreign banks must have a minimum of 600 million yuan
(US$72.3 million) in capital before they can provide a full range
of both foreign currency and renminbi services to local
clients.
"Foreign banks are definitely interested in providing as many
banking products as possible to local clients, so long as the
central bank permits us to do so," said Timmy Leung, vice president
of the Shanghai branch of the Hong Kong-based Bank of East Asia
Ltd.
The Hongkong and Shanghai Banking Corp. and Citibank have applied
to the Chinese central bank to be custodian banks for qualified
foreign institutional investors buying Class-A shares on domestic
stock markets.
Eight overseas banks have begun to offer retail forex services to
local residents and enterprises since the first half of last year,
including Citibank, HSBC, BEA and Standard Chartered Bank.
By
the end of last year, the eight banks had attracted
forex-denominated deposits worth US$163 million, which represents
13.55 percent of all new forex deposits in 2002.
(eastday.com January 11, 2003)