DISGUST at the inefficient and unpredictable operating procedures of banks in China has led increasing numbers of multinational companies to turn to foreign banks to help finance mainland projects, a senior corporate banking manager says. 'In the whole of China, there is no balance sheet. The local banks are operating without any financial accountability,' said Victor Sun, of Hongkong Bank's Shanghai branch. 'Why should they try to find out how good you are? They will just turn around and say: 'Give us a bank guarantee from the outside'.' Although only mainland banks are allowed to lend yuan, foreign banks provide the customer service and efficiency that overseas businesses have come to expect. Mr Sun said that last month more than 30 multinationals approached him for letters of guarantee, credit assessments and advice. 'You come to us and say you need something very quick and I can do it because I try to understand what you require,' he told about 25 foreign investors and bankers at an Asia Law and Practice seminar yesterday. 'In 24 hours, we can come up with a proposal and, lo and behold, when you take the proposal to a local bank, they copy it.' If a multinational company approached a mainland bank directly, it could take two or three months for the request to be processed. And even then, approval of the loan hinged on personal connections and not the viability of the project. 'If you know someone who is very powerful and who can put pressure on the local bank, then you can come up with the funds, Mr Sun said. 'But that's not a natural way to work.' Conversely, foreign banks would often be able to help as soon as the foreign company produced a feasibility study, received approval from mainland authorities for the project and was found to be creditworthy. However, debt financing is not the only way the 200,000 joint venture and foreign-backed enterprises in China can get funds. According to Richard Margolis, of Smith New Court Far East, investors should also consider listed equity funds and private investment groups, which normally reserve a portion of their capital for direct investments.