Despite promises of more equitable treatment towards mainland banks wanting to open branches in the United States, mainland officials expect another difficult year of trying to make headway in the world's most lucrative market. In the latest round of the strategic economic dialogue with the US last month, Washington agreed for the first time to apply 'national treatment' to mainland lenders expanding operations in the country. 'Applications by Chinese banks will be evaluated consistent with the principle of national treatment, and applies the same prudential standards to all applications by foreign banks to establish branches or subsidiaries or to acquire stakes in existing US banking institutions,' the US Department of the Treasury said in a joint statement posted on its website. The agreement triggered hopes the mainland will be able to speed up its US banking expansion, which has lagged behind its international peers. 'The agreement is quite an achievement, but without major breakthroughs. There was no substantial policy change, after all,' said an official at the China Banking Regulatory Commission. 'Even if the federal government committed to make progress, state regulators are not likely to follow the lines directly.' In November 2006, China Merchants Bank became the first mainland lender in 16 years to set up a branch in New York. It was only the second mainland branch set up in the US since Bank of China paved the way in 1981. 'Sixteen years is too long to wait,' said China Merchants Bank senior vice-president Zhang Guang-hua last month. 'The US has asked us to meet numerous criteria, which mainly focus on anti-money laundering issues.' Other mainland lenders queueing up for US branch approvals include Industrial and Commercial Bank of China and China Construction Bank. 'We will continue to see more mainland lenders get the nod to open branch offices in the United States this year,' said Dorris Chen, an analyst with BNP Paribas. 'However, the regulation of mainland lenders is not going to loosen to any extent, given that the US subprime fallout is still the hottest issue this year.'