Standard Chartered’s Hong Kong unit has applied to establish a securities company in mainland China, joining other global firms looking to ramp up their presence in the region as the country opens its financial sector to foreign players.
“China is a strategically important market to Standard Chartered,” Standard Chartered spokesperson Shaun Gamble said Monday. “We have always been active in its capital markets and are looking to further develop our onshore business through acquiring new licenses.”
The application follows the U.K.-headquartered bank’s recent moves to deepen its presence in China. Standard Chartered said in July that it planned to invest HKD 310 million ($40 million) to set up a new center in Guangzhou, as Beijing aims to transform the coastal Greater Bay Area region into an international financial hub. The bank said at the time that it will be adding around 1,600 staff to the Standard Chartered Greater Bay Area Center by the end of 2023.
The commitment came after the bank faced criticism in the U.S. and Europe for publicly supporting a controversial Chinese national security law for Hong Kong in June alongside fellow U.K.-based but Asia-focused lender HSBC .
The bank is also currently one of the Hong Kong special administrative region’s three note-issuing banks, with the other two being HSBC and Bank of China (Hong Kong). The bank incorporated its Hong Kong business in 2004 and now operates as a licensed bank in Hong Kong as Standard Chartered Bank (Hong Kong), a wholly owned subsidiary of Standard Chartered.
Standard Chartered is not the only international bank trying to gain a bigger foothold in China as the nation’s financial sector opens up. Goldman Sachs and JPMorgan Chase are both reportedly in talks to take full control of their Chinese securities joint ventures this year. Goldman currently owns 51% of Goldman Sachs Gao Hua Securities Company but is planning to buy the remaining 49% from its local partner, Beijing Gao Hua Securities Company, while JPMorgan reportedly received the first right to buy a 20% stake in its Chinese securities joint venture for CNY 177.7 million ($26 million) from its local partner Shanghai Waigaoqiao FTZ. This would raise the bank’s ownership from 51% to 71%.
Other global firms making similar moves include Morgan Stanley, which received approval in March to take a majority stake in its China securities joint venture, Morgan Stanley Huaxin Securities Company, increasing its holding from 49% to 51%. Meanwhile, Credit Suisse won approval from regulators in April to become the majority shareholder of Beijing-based Credit Suisse Founder Securities, upping its stake from 33.3% to 51%. The Swiss bank is also planning on doubling its staff in China over the next five years.