Money

CCB not rule out merger with Russian banks

(Xinhua)
Updated: 2011-05-31 17:27

MOSCOW -- China Construction Bank (CCB) did not rule out the possibility of acquisitions of Russian commercial banks or investment in Russian banking field, CCB President Zhang Jianguo said Monday.

The CCB, China's second largest State-owned commercial bank with its total value ranking the second in the world, sees Russia as a key market in CCB's overseas site construction, Zhang said at the opening ceremony of CCB's first representative office in Russia.

"Russia is a crux market of Eastern Europe, as the market has enormous potential in economic development," Zhang told Xinhua.

He noted that currently Russia has more than 900 commercial banks. "We noticed that foreign banks have shown their great interests in purchasing the assets of Russian commercial banks," Zhang said.

"If we have a right opportunity, we will not miss this opportunity (to purchase Russian commercial banks)," he said.

CCB's overseas site construction strategy is to expand its branches abroad and buy foreign assets, he added.

Related readings:  CCB's profits up 34.23% in Q1  Banks see 'controllable risk' in letters of guarantee in Libya  CCB profit growth to continue rising  China Construction Bank unit to boost research team by 40%

In his speech at the ceremony, Zhang said the opening of CCB's representative office in Russia signaled CCB's latest important move to enlarge its overseas service network.

He told Xinhua that the Moscow office was the first step of CCB's overseas site construction, revealing that the bank intends to upgrade the office into an overseas branch within two years.

"We hope all our inside procedures and processes could be finished this year and then we would officially submit an application to the China Banking Regulatory Commission for opening the Russian branch," Zhang said.

"We also hope to receive the approval from Russian Central Bank in 2012," he added.

Zhang admitted that Chinese bankers did not fully realize the potential of cooperation between China and Russia in the past.

"But now, with the bilateral banking cooperation showing its good development potential, CCB would increasingly pay its attention to the cooperation with Russian banking," Zhang said.

With regard to future bilateral cooperation, Zhang said that there are still room for further development as four potential fields need to be tapped.

The first field is investment banking, the second is border trade, the third is supporting Chinese companies' development in Russia and supporting Russian companies' listing in Chinese stock markets, and the fourth is interbank clearing settlement, Zhang explained.

He added the CCB is expected to play an effective role in promoting Sino-Russian economic and trade cooperation.

According to Zhang, as bilateral cooperation between China and Russia has expanded in various fields including politics, trade and economy, CCB has established strategic cooperation agents with 58 Russian commercial banks.

The CCB has also opened more than 40 border trade settlement accounts with several major Russian banks, Zhang added.

Since 1995, the CCB has established nine overseas branches, three subsidiaries and two representative offices.