China lets UBS control securities business
UBS has been authorised by China’s securities regulator to take a controlling stake in a local business, making the Swiss giant the first foreign bank allowed to do so under new rules.
In April, Beijing relaxed the rules in the financial industry in a move to open up the economy. “The China Securities Regulatory Commission (CSRC) recently approved UBS AG to increase the shareholding ratio of UBS Securities Co. Ltd. to 51 per cent,” the regulator said in a statement on Friday.
“This is the first foreigncontrolled securities company approved by the China Securities Regulatory Commission after the implementation of the Measures for the Administration of Foreign-invested Securities Companies.”
USB AG, which currently owns about 25 per cent of shares in the USB Securities Co. Ltd joint venture, said it would acquire stakes from China Guodian Capital Holdings and COFCO. Other financial firms like Wall Street titan JP Morgan Chase and Japan’s Nomura Holdings are awaiting approval.
Opening up economy
Laws limiting foreign ownership of local financial firms have long stopped global banks from independently operating in China. But Beijing said it would liberalise shareholding limits in the financial services industry last year.
Earlier last week, two European insurance giants Allianz and Axa got approvals to start a company fully funded by foreign capital and to take full control of a joint venture respectively.
Beijing pledged to open up its economy, to head off possible trade tensions with the US. Trump has slapped tariffs on more than $250 billion (Dh918 billion) in Chinese imports, and China responded with its own tariffs on $110 billion in US goods.