Ping An Bank, a joint venture between the Ping An Insurance (Group) Company of China and the Hongkong and Shanghai Banking Corporation (HSBC), yesterday announced the relocation of its headquarters to Shanghai from Fuzhou, capital of East China's Fujian Province.

The bank also said it has downgraded its former Fuzhou headquarters to a branch, effective yesterday.

The bank said the move to Shanghai was an essential step to quickly develop its business in China.

"We must do this," said Kun-te Chen, president of Ping An Bank.

"The financial market in Shanghai is huge and mature with many international banks having long established their Chinese headquarters here," Chen added. "The hot competition in the city poses great challenges, but it will bring more opportunities to help us grow faster."

Louis Cheung, chief operating officer of Ping An, told local media during a briefing yesterday in the new headquarters that banking services will become one of Ping An's key businesses in the future, and the group is "open to any other opportunities."

Ping An is now China's third financial holding group after CITIC Group and Everbright Group, with brokerage service, trust, banking, insurance and other financial businesses.

Cheung declined to comment on the market rumour that Ping An is negotiating to acquire the Guangdong Development Bank.

Banks in Shanghai, numbering 2,988 at the end of last year, posted a combined profit of 9.5 billion yuan (US$1.15 billion) in the first quarter of this year, up 16.5 per cent from a year earlier, according to statistics from the Shanghai Banking Regulatory Commission.

Profits by foreign banks grew even faster, with a year-on-year increase of 46.8 per cent.

Meanwhile, the city government is spending great effort in enhancing Shanghai's role as China's financial hub, by attracting more financial talent and creating a better environment, the city's vice-mayor Feng Guoqin said at yesterday's relocation ceremony.

Although Ping An Bank currently has only two branches, with a net profit of 3 million yuan (US$362,319) last year, Chen said that his goal was to make it one of China's top 10 commercial banks within a decade.

"That's not too great an expectation," said Chen, who previously worked with the Chinatrust Commercial Bank, a major privately owned financial institution on Taiwan island.

His confidence partially comes from the strong support from PICC.

"We will give as much financial support as possible," said Cheung.

The group's initial public offering in Hong Kong two weeks ago, which raised US$1.84 billion, greatly enhanced its capital adequacy. 

(CRIENGISH)

downgrade: rate lower; lower in value or esteem（使降级）