China opens up its finance industry to the world
  • China opens up its finance industry to the world

    Beijing says it will allow foreign companies to own Chinese banks and investment firms in the latest sign the world's second-biggest economy is opening up its vast financial industry. China's vice minister for finance Zhu Guangyao revealed the changes during a press briefing Friday. A cap on foreign investment in Chinese banks will be removed. And foreign investors will be allowed to own 51% in securities firms, investment managers and life insurance providers.To get more china latest financial news, you can visit shine news official website.

    Zhu said the new rules would come into play "soon." He gave no further details on timing.

    Big Western banks are largely absent in China -- only HSBC (HSBC) has a significant presence through its 19% stake in Bank of Communications -- but they are keen to take advantage of the country's growing wealth.

    The restrictive ownership rules in China's sector have been a big bone of contention for U.S. firms in the recent past. As foreign banks were only allowed minority shareholdings, they had limited influence over big decisions.

    That's why JPMorgan (JPM) sold a minority stake in its investment banking joint venture in the country last year.

    But CEO Jamie Dimon has since said he would be up for a second crack at China if the bank could control its business there, and a spokesman for America's biggest bank welcomed the rule change. "The Chinese government's decision to allow foreign companies to take up to 51% in securities joint venture represents an important step in further opening up China's financial sector," said Eugene Qian, chairman of UBS's (UBS) China Strategy Board.

    The news came at the end of President Trump's visit to China this week. Trump frequently points out China's huge trade surplus with the U.S., which stood at almost $350 billion last year.

    Making it easier for American firms to sell financial services in China could help to achieve a better trade balance.

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