Credit Suisse wins China brokerage approval in sign of reform
[HONG KONG] Credit Suisse Group AG said on Thursday its investment banking joint venture in China has won approval to provide securities brokerage services, in a further sign of China's gradual warming to foreign players in its securities industry.
The joint venture, Credit Suisse Founder Securities Ltd, is the first Sino-foreign firm to get approval to buy and sell shares on behalf of clients since China rewrote the rules for foreign participation in its securities industry in 2007.
It comes at a time when trading in China's volatile stock markets is providing strong returns to local brokers.
The venture will be limited to providing brokerage in the country's Shenzhen Qianhai development zone in the southern province of Guangdong, where HSBC earlier this month announced it would launch its own investment banking partnership.
Foreign securities joint ventures in China mostly operate under restricted licences that limited them to underwriting equity offerings, rather than the potentially more lucrative business of buying and selling shares on behalf of clients.
Goldman Sachs and UBS were the first foreign investment banks to set up in China in 2004 and 2006 respectively, before the country altered the rules on such joint ventures to limit foreign ownership to 33 per cent and narrow their busuiness scope.
Credit Suisse said its joint venture is in the final stages of setting up its trading outlet in Qianhai, and is expected to start securities brokerage services early next year.
REUTERS
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