HSBC Holdings, the parent company of Hong Kong's biggest lender, may acquire a mainland brokerage house to tap into China's securities trading business, according to Peter Wong Tung-shun, an executive director of Hongkong and Shanghai Banking Corp.
Mr Wong said HSBC would join forces with the Bank of Communications, in which it holds a 19.9 per cent stake, to take advantage of its partner's branch network and client base, if the idea was pursued.
The central government is currently reforming the securities brokerages, many of which have been plagued by corruption and mismanagement. The largest and best performing of the country's 120 or so brokerages are being bailed out by the central bank, while the worst performers are being closed or merged with better-performing companies.
'The government intends to give management control [of the securities houses] to lure foreign companies,' Mr Wong said.
He said the bank would consider an acquisition under such circumstances, and was evaluating the situation. He declined to comment on whether any specific discussions were under way.
The securities business remains one of the few missing pieces that HSBC has wanted to put in place to complete its coverage of the mainland financial market.
