Stan­dard Char­tered: Sup­port­ing Chi­nese En­ter­prises

Trade, the Belt and Road Ini­tia­tive, and the 160th an­niver­sary of Stan­dard Char­tered’s un­in­ter­rupted op­er­a­tion in China are the bank’s high­lights at the China In­ter­na­tional Im­port Expo.

China Pictorial (English) - - Contents - Text by Hu Zhoumeng

Since Stan­dard Char­tered Bank set up its first Chi­nese branch in Shang­hai in 1858, it has wit­nessed the great eco­nomic devel­op­ment in con­tem­po­rary China. Es­pe­cially since 1978, the coun­try’s re­form and open­ing up has pro­vided huge op­por­tu­ni­ties for the devel­op­ment of the bank. Stan­dard Char­tered has one of the largest for­eign bank net­works in China. In 2007, Stan­dard Char­tered Bank (China) Lim­ited be­came one of the first batch of for­eign-funded lo­cal cor­po­rate banks. Over the past decade, Stan­dard Char­tered has opened 100 out­lets across 30 Chi­nese cities, em­ploy­ing more than 6,000 peo­ple.

As China opened its door to the out­side world, Stan­dard Char­tered Bank be­gan ac­tively sup­port­ing cross-bor­der trade and in­vest­ment by help­ing Chi­nese en­ter­prises reach out and overseas en­ter­prises en­ter. Re­cently, Zhu Yam­ing, vice pres­i­dent and man­ag­ing di­rec­tor of the Per­sonal Fi­nance Depart­ment of Stan­dard Char­tered Bank (China) Lim­ited, was in­ter­viewed by China Pic­to­rial (CP). She said that Stan­dard Char­tered Bank will fo­cus on ad­van­ta­geous fields in line with the fu­ture tra­jec­tory of China’s econ­omy in­clud­ing the Belt and Road Ini­tia­tive, the in­ter­na­tion­al­iza­tion of RMB, the open­ing up of fi­nan­cial mar­kets, the devel­op­ment of small and medium-sized en­ter­prises (SMES), and the con­tin­u­ous ex­pan­sion of the mid­dle-in­come group.

CP: In 2018, in re­sponse to the na­tional pol­icy of fur­ther open­ing up in the fi­nan­cial sec­tor, China re­laxed re­stric­tions on the es­tab­lish­ment of for­eign- funded fi­nan­cial in­sti­tu­tions, , ex­panded their busi­ness scopes and rolled out mea­sures res to widen mar­ket ac­cess for for­eign com­pa­nies. What does es Stan­dard Char­tered Bank think of these new poli­cies?

Zhu: Stan­dard Char­tered Bank k wel­comes the in­tro­duc­tion and im­ple­men­ta­tion of poli­cies on deep­epen­ing the coun­try’s open­ing up and d re­lax­ing mar­ket ac­cess in the fi­nan­n­cial sec­tor. These proac­tive mea­sures res will ex­pand for­eign fi­nan­cial in­sti­tuu­tions’ busi­ness op­er­a­tions in China a and ac­cel­er­ate the re­form of Chi­nese ese banks. We have been greatly en­cou­ruraged by these mea­sures along with h other for­eign banks. Fur­ther ex­pann­sion of the fi­nan­cial sec­tor not only re­flects China’s open­ing up at t a higher level, but also pro­motes deeper in­te­gra­tion of in­ter­na­tional al and do­mes­tic mar­kets.

Thanks to those open­ing-up poli­cies, China’s fi­nan­cial in­dus­try has wit­nessed great changes, one of which is the in­tro­duc­tion of var­i­ous us in­no­va­tive fi­nan­cial prod­ucts and ser­vices. Stan­dard Char­tered Bank k has of­fered fea­tured fi­nan­cial ser­vices ices in­clud­ing trade fi­nanc­ing, struc­tured ed fi­nance, in­ter­na­tional trade set­tle­ment, for­eign ex­change and derivaa­tives, cash man­age­ment and wealth h man­age­ment to meet the needs of f the Chi­nese mar­ket.

CP: Since the Belt and Road Ini­tia­tive was in­tro­duced five years ago, more and more Chi­nese en­ter­prises have be­gun to ex­plore overseas mar­kets and dock with overseas part­ners. How will Stan­dard Char­tered Bank help these en­ter­prises?

Zhu: Stan­dard Char­tered Bank has long con­sid­ered the Belt and Road Ini­tia­tive the fo­cus of its strat­egy. Nearly 70 per­cent of Stan­dard Char­tered Bank’s global branches are in coun­tries and re­gions in­volved in

the Belt and Road Ini­tia­tive. In most of those coun­tries and re­gions, we have op­er­ated for more than 100 years and have a pro­found un­der­stand­ing of lo­cal poli­cies, economies and cul­tural en­vi­ron­ments. In 2017, we par­tic­i­pated in 50 projects, more than half of which were in Africa and an­other quar­ter in South Asia.

Over the past five years, Stan­dard Char­tered has been pro­vid­ing in­no­va­tive and high-qual­ity fi­nan­cial prod­ucts and ser­vices for Chi­nese en­ter­prises par­tic­i­pat­ing in the projects. Stan­dard Char­tered has also es­tab­lished close part­ner­ships with China’s pol­icy banks, com­mer­cial banks, im­port and ex­port credit in­sur­ance in­sti­tu­tions, mul­ti­lat­eral fi­nan­cial in­sti­tu­tions and on­line fi­nan­cial ser­vices in­sti­tu­tions, and car­ried out sub­stan­tive co­op­er­a­tion with them.

CP: What dif­fi­cul­ties are faced by SMES in fi­nanc­ing? How does Stan­dard Char­tered Bank help solve these prob­lems?

Zhu: Stan­dard Char­tered China set up a spe­cial SME unit in 2003 and has been cul­ti­vat­ing SME busi­ness in China for 15 years. Many SMES have dif­fi­cul­ties se­cur­ing loans be­cause they can­not pro­vide suit­able col­lat­eral. For such light as­sets en­ter­prises, we will com­pre­hen­sively in­spect the busi­ness model of the en­ter­prises, the devel­op­ment of the in­dus­try, ex­ist­ing con­tract or­ders, abil­i­ties of lead­ers and other things. We solve the fi­nanc­ing prob­lems of these en­ter­prises through the com­pre­hen­sive rat­ing of en­ter­prise credit and pro­vid­ing non-mort­gage loans for SMES.

CP: What risks are faced by Chi­nese en­ter­prises in in­ter­na­tional trade? How does Stan­dard Char­tered Bank help these busi­nesses re­duce risks?

Zhu: The ser­vices we pro­vide for im­port busi­nesses can be sum­ma­rized in four as­pects: short­term trade fi­nanc­ing, cross-bor­der fi­nanc­ing, for­eign ex­change risk man­age­ment, and re­gional risk man­age­ment.

First, for­eign sup­pli­ers nor­mally re­quire im­porters to pay de­posits or pre­pay for goods. Cap­i­tal de­mand can be met by fi­nanc­ing prod­ucts. In­ter­na­tional banks can help com­pa­nies uti­lize cap­i­tal from home and abroad, re­duce fi­nanc­ing costs and ex­pand fi­nanc­ing chan­nels.

Sec­ond, in­ter­na­tional banks can fa­cil­i­tate seam­less trans­ac­tions for buy­ers and sup­pli­ers in in­ter­na­tional trade, avoid­ing de­lays or er­rors be­tween the two par­ties in oth­er­wise cross-bank pay­ments, which can cause com­pa­nies to lose busi­ness op­por­tu­ni­ties.

Third, trad­ing com­pa­nies are im­pacted by ex­change rate fluc­tu­a­tions, but ex­pe­ri­enced in­ter­na­tional banks can pro­vide com­pre­hen­sive for­eign ex­change so­lu­tions in­clud­ing money ex­change and trans­fer, for­ward ex­change trans­ac­tions and for­eign ex­change swaps that can help com­pa­nies con­trol ex­change rate risk.

Fourth, it is dif­fi­cult for do­mes­tic com­pa­nies to as­sess overseas risk when im­port­ing goods from a for­eign land. They are sub­jected to un­fore­seen mar­ket changes and may fail to se­cure sta­ble sources of pro­cure­ment. With the help of banks with global net­works, com­pa­nies can gain more mar­ket in­sights and valu­able sug­ges­tions. CP: RMB has be­come the world’s third-largest trade fi­nanc­ing cur­rency and the sixth largest pay­ment cur­rency. Its func­tion as a trade, pay­ment and fi­nanc­ing cur­rency is in­creas­ing. How is Stan­dard Char­tered Bank adapt­ing to this new trend?

Zhu: Stan­dard Char­tered Bank is at the forefront in the field of RMB in­ter­na­tion­al­iza­tion. We have 11 for­eign cur­rency di­rect trad­ing mar­ket qual­i­fi­ca­tions, and we are one of the first banks to be granted di­rect ac­cess to China’s Cross-bor­der In­ter­bank Pay­ment Sys­tem. We are also the first in­ter­na­tional bank to pro­vide RMB clear­ing ser­vices and one of the largest RMB clear­ing in­sti­tu­tions in China. Stan­dard Char­tered Bank op­er­ates a strong net­work of on­shore and off­shore RMB ser­vices in more than 36 coun­tries and re­gions.

CP: What will Stan­dard Char­tered Bank dis­play at the China In­ter­na­tional Im­port Expo (CIIE)?

Zhu: Stan­dard Char­tered Bank is one of the first en­ter­prises to pledge to par­tic­i­pate in the CIIE. Our booth at the expo will fo­cus on three main themes: trade, the Belt and Road Ini­tia­tive, and the 160th an­niver­sary of its op­er­a­tion in China. Stan­dard Char­tered Bank will re­lease a cus­tom­ized trade fi­nanc­ing plan for im­port com­pa­nies dur­ing the expo. One thing deeply rooted in Stan­dard Char­tered Bank’s DNA is sup­port­ing cross-bor­der trade. Cur­rently, we have rich ex­pe­ri­ence and re­sources in pro­vid­ing short­term trade fi­nanc­ing and for­eign ex­change man­age­ment, and we are glad to sup­port ex­hibitors and buy­ers at the expo with our ser­vices.

Zhu Yam­ing, vice pres­i­dent and man­ag­ing di­rec­tor of the Per­sonal Fi­nance Depart­ment of Stan­dard Char­tered Bank (China) Lim­ited. cour­tesy of Stan­dard Char­tered Bank

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