BIZCHINA / Center |
Hang Seng targets robust renminbi clientsBy Wang Zhenghua (China Daily)Updated: 2007-02-03 08:48 Hang Seng Bank, one of the nine overseas banks recently approved for retail business on the mainland, will mainly target higher-end customers after it registers as a local entity. "Hang Seng will require a threshold of 300,000 yuan (for mainland customers to open an account), and only customers with 500,000 yuan or more in accounts will be waived the management fee," said Johnson Fu, the Hong Kong bank's mainland business chief, who was attending Friday's forum for Hong Kong Financial Services. Incentives to attract premium customers are expected to become a common practice for overseas lenders when they soon begin renminbi business. It also avoids head-to-head rivalry with domestic banks for ordinary customers. The central bank's Shanghai headquarters said on Friday that 2006 profits of overseas lenders in the city surged 35.5 percent compared to a year ago. Fu did not disclose how much Hang Seng will charge for managing individual accounts. It currently collects no fees from depositors with a minimum of 1 million yuan in the bank. "Hang Seng will embark on all kinds of businesses on the mainland including retail and corporate banking," said Fu, whose bank is a principal member of the HSBC Group. The lender announced on Wednesday the opening in Guangzhou of its 16th mainland outlet. Fu will move his office from Hong Kong to Shanghai later this month. The bank also has a 12 percent stake in the Industrial Bank, holdings that were diluted from 15.98 percent during the mainland lender's recent initial public offering. He also said overseas lenders are lobbying the central authorities to allow them to inject capital in their future local corporations in renminbi rather than dollars. The central bank's local headquarters said on Friday that financial institutions in the city witnessed slower growth in deposits and moderate growth in lending in 2006. By the end of last year, the outstanding value of deposits amounted to about 2.65 trillion yuan, an increase of 13.4 percent from a year ago. Total lending grew 10.6 percent year-on-year to 1.86 trillion yuan at the end of last year. Overseas banks in Shanghai accounted for 14.2 percent of the total lending by financial institutions in the city.
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