RBS, Guolian team up to tap securities market

PUBLISHED : Tuesday, 31 May, 2011, 12:00am
UPDATED : Tuesday, 31 May, 2011, 12:00am


The Royal Bank of Scotland has approached a number of European candidates interested in listing on the pending international board at the Shanghai Stock Exchange.

The move is in line with the launch yesterday of Huaying Securities, a joint venture investment bank between RBS and Guolian Securities, as both companies strive to tap the fast-growing mainland securities market. 'We have prepared a long list of candidates that are likely to seek a listing on the board,' RBS greater China head Lawrence Lam said. 'We should have an advantage in pitching the business since we have a good relationship with potential clients.'

The British lender had a team of investment bankers in Hong Kong responsible for luring European firms to raise funds on markets in Asia, including Shanghai and Hong Kong, Lam said.

RBS secured Beijing's approval to open the joint-venture, allowing it to profit from the rapidly growing underwriting business in the world's largest initial public offering market.

Guolian, based in Wuxi, Jiangsu province, owns two-thirds of the joint venture while the British partner has the remainder. Guolian, whose underwriting business ranked 38th on the mainland in 2009, merged its own investment banking team into the newly created Huaying.

'This joint venture marks another milestone for RBS and its business in the Asia-Pacific,' RBS Asia-Pacific chairman John McCormick said. 'This securities joint venture puts the last piece in our jigsaw puzzle.'

With Huaying, RBS is also the first British bank to own a stake in a mainland joint-venture investment bank. It owns an incorporated bank and a wholly owned leasing business on the mainland. RBS also has a 20 per cent stake in Suzhou Trust and 17 per cent of Galaxy Futures.

Efforts to draw foreign companies to the mainland's IPO market would give Huaying a much needed boost to its ambition of becoming one of China's top 10 players in the investment banking sector, Huaying general manager Ding Ke said.

But neither Guolian bosses nor RBS executives would reveal the names of potential clients interested in a Shanghai listing.

Lam said only large foreign firms were likely to get the mainland regulator's green light to list on the international board. According to people with knowledge of the matter, Beijing is set to launch the international board soon.