China bank wins green light for US office
United States regulators have given China Merchants Bank approval to set up a representative office in New York - the first granted to a Chinese bank since misconduct at Bank of China New York grabbed the headlines in January.
The US Federal Reserve said in a Web site announcement the soundness of the home-country regulator was among the factors considered in China Merchants' application, essentially acknowledging an improvement at the People's Bank of China.
A China Merchants Bank official said yesterday the Fed gave approval on October 22, while the New York State government's banking department gave the green light on November 5.
China Merchants Bank is the mainland's sixth-largest commercial lender and one of four locally listed mainland banking counters.
The New York representative office will be the bank's second overseas presence after Hong Kong, in which it gained a branch office in August. It is thought to be eyeing offices in Taiwan.
China Merchants, a Shenzhen-based bank with combined assets of about US$38.1 billion according to the Board's data, is set to join its bigger peers with its New York presence, including the big-four mainland state banks and the Bank of Communications. It is 23.7 per cent controlled by state-run China Steam Navigation Co.
A China Merchants Bank official said New York's financial importance and expected strong growth in US-China trade made the branch expansion inevitable.
In China Merchant's record of operations and financial strength, the Federal Reserve said: 'The bank appears to have the experience and capacity to support the proposed representative office and has established controls and procedures for the proposed representative office to ensure compliance with US laws.'
The China Merchant's official stressed that the New York opening 'marks a significant step towards US recognition of the soundness of China's banking supervision' after the Bank of China scandal.
