Bank of East Asia has beaten its bigger Hong Kong rivals in the race to take deposits and make loans to customers at a mainland branch network. The bank, initially restricted to foreign-currency business, would waste no time taking deposits, but would expand into the lending market only 'gradually', said Chan Kay-cheung, executive director and deputy chief executive yesterday. Still waiting for approval from the People's Bank of China to conduct foreign-currency business with mainland individuals and corporations are HSBC and Standard Chartered Bank. Citibank earlier last week became the first foreign bank to get approval. 'We submitted applications to do foreign-currency business with locals at all of our seven branches in early February, when the new regulations were published,' Mr Chan said. Approvals were received last week for two of the branches - Guangzhou and Zhuhai - and the remaining approvals were expected soon. 'We will begin taking foreign-currency deposits and follow gradually with both corporate and consumer lending,' he said. Like other foreign banks operating in China, Bank of East Asia had so far taken deposits and made loans to foreign customers and thus had experience operating on the mainland. However, unlike other foreign banks, Bank of East Asia was an indigenous Chinese bank, spoke the same language as mainlanders, and understood the culture, Mr Chan said. The bank would initially treat its new customers like private banking clients, since mainlanders able to make foreign-currency deposits were wealthier. 'We will be offering them wealth-management products,' he said. The bank's China operations were already substantial net contributors to bottom-line profit, he said, contributing about 9.6 per cent to last year's net earnings, on an asset base of about 6-7 per cent of total group assets. 'We are regarded as one of the most profitable foreign banks in China,' said Mr Chan. The bank now hoped to boost profitability of its mainland operations by entering the higher-yielding consumer lending market, he said, in particular with the issue of foreign-currency credit cards.