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Hongkong and Shanghai Banking Corp, a unit of HSBC Holdings, is gearing up to
capture a share of the mainland's personal finance market once the business
becomes fully open to foreign banks in 2006.
In the interim, Hongkong Bank will open more branches and sub-branches, train
mainland staff and design products tailor-made for mainlanders, according to
the bank's personal financial services China head Mike Yeung.
``I believe the market in China will gradually become mature and prosperous with
domestic residents' growing income and their increasing awareness in personal
finance,'' he said.
To compensate for the bank's lack of a nationwide branch network, which its
biggest mainland-based competitors have, Hongkong Bank will rely on its
telephone and online banking service to win customers.
Next Monday, HSBC will open its branch in Suzhou in the booming Yangtze River
Delta, bringing the number of branches on the mainland to 10, along with three
sub-branches, two representative offices, and 21 automatic teller machines.
However, the bank reckons that recruiting and training mainland staff is the
single most important thing it can do to get ready for the market opening.
Already, the bank recruits recent graduates from mainland universities, then
posts them to Hong Kong or HSBC's home base in London.
They are then shifted among several mainland cities to broaden their experience.
The whole process takes 10-12 years, Yeung said.
For now, the bank is severely restricted in the services it can offer through
its existing mainland branches. Mostly, it provides foreign currency and
yuan-denominated personal financial services to people from overseas including
Hong Kong, Macau and Taiwan.
The bank can also provide personal financial services to mainlanders who have
access to hard currency. Foreign banks will remain barred from offering
yuan-denominated financial services to mainlanders until the end of 2006 or
early 2007.
Shanghai, along with other big and relatively wealthy mainland cites such as
Guangzhou, Beijing and Shenzhen, offer the greatest near-term potential to
develop a personal finance business.
pamela.pun@globalchina.com
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