SSVB unveils RMB business
The SPD Silicon Valley Bank (SSVB) on Sept 9 introduced RMB business to its Chinese customers, and the move is expected to benefit more local tech and innovation companies as well as their investors. The first batch of 20 companies signed contracts for the new service on the very same day.
SSVB, a joint venture between Shanghai Pudong Development Bank Co Ltd (SPD) and US-based Silicon Valley Bank (SVB), was founded in 2012 and is China’s first commercial bank dedicated to such businesses.
David Jones, president of SSVB, said that the growth momentum of technology and innovation companies in Shanghai is creating signifi opportunities for the bank and its RMB capability.
“Our RMB capability will bring tailor-made financial solutions to companies of all stages and will help facilitate their global aspirations,” Jones added.
According to Greg Becker, president and chief executive officer of SVB, being able to operate in RMB enables SSVB to support their clients’ financial needs onshore and offshore. The Shanghai-headquartered bank is currently able to offer commercial bank services for onshore accounts, deposits and loans in foreign and local currency, foreign exchange and online banking.
Wu Xin, president of TV Mining, said that the biggest difference between SSVB and a traditional bank is that the latter is focused on assets and mortgages while SSVB takes into account innovation quality and industrial insights.
Tu Guangshao, deputy mayor of Shanghai who attended the inauguration ceremony of the bank, said that the city can learn from SVB’s experiences in the US as it seeks to become a global technological innovation center. The municipal government of Shanghai approved a framework in May for transforming the city into a technological innovation center.
More business opportunities are expected to emerge following the launch of this RMB service.
“In the next steps, Shanghai Pudong Development Bank will continue to support SPD Silicon Valley Bank’s growth and the two parties can team up in areas like RMB credit business, cross-border RMB business, funds custody, assets management, financial market, interplay of equity and debt. Together we will explore innovative financial models of serving China’s tech and innovation space,” said Ji Xiaohui, chairman of SPD.
China’s technology innovation industry has been rapidly expanding in recent years, and demand for financing by emerging technological enterprises has been rising as a result. In the first quarter this year, nearly $3 billion was generated through venture capital by Chinese technological innovation enterprises, a jump of 69 percent year-on-year, the Securities Times reported.
Over the last three years, SSVB has been working on building an innovation ecosystem in China through SVB’s global network and SPD’s expertise in the local market. Apart from its banking services, SSVB is also building innovation partnerships with research institutes, innovation incubators, investors, as well as tech and innovation companies.