Standard Chartered Plc may expand its global markets team in China by 40 percent by 2012, as the nation opens its financial markets to attract foreign investors, said John Tan, head of the division.
The UK bank, which makes most of its profit in emerging markets, will increase its fixed-income, currency and commodity operation's headcount to 140 by 2012 from about 100 now, Tan said in an interview on April 14.
"The market is opening up, and we are positive that it would bring along a lot of opportunities," said Shanghai-based Tan. "China is a huge market with big potential."
Bank of Communications Ltd and DBS Group Holdings Ltd are also planning to enlarge currency and fixed-income teams, anticipating China will accelerate market development as the global financial crisis eases. The central bank on April 2 pledged to gradually loosen controls on cross-border capital flows and increase opportunities for foreign investors.
The State Administration of Foreign Exchange, the nation's currency regulator, in October raised the limit on quotas for investors under the Qualified Foreign Institutional Investors program to $1 billion from $800 million.
Du Jianglong, board secretary at BoCom, China's fourth- largest bank by market value, said in an interview that the bank is also adding people to its financial markets division because of rising demand from clients. He declined to give further details. DBS, Southeast Asia's biggest bank, said on April 13 about 200 people will be added this year to the China branch, including treasury and markets operations.
China said last year locally incorporated foreign banks would be allowed to underwrite corporate bonds with maturities of no more than one year and medium-term notes, according to Tan. Standard Chartered hopes to obtain the license "very soon," he said.
Standard Chartered in January was given approval by China's regulators to become the third foreign bank to operate as a market maker in China's interbank bond market. The bank also provides quotes for the Shanghai Interbank Offered Rate, or Shibor, which is becoming a better benchmark for funding costs, he said.
China fully opened its banking industry to overseas companies in December 2006, sparking a rush among foreign banks including HSBC Holdings Plc, Citigroup Inc and Standard Chartered to open branches to compete for the nation's $7.2 trillion corporate and household savings.
China may allow overseas companies to be listed on a stock exchange in Shanghai by the end of this year, said Xu Quan, deputy director of the city's financial service office. Standard Chartered will "support" the central government's aim to build a global finance center in the city by 2020, Tan said.