China broker GF Securities pays US$36.1m for Natixis trading unit

One of China's top securities brokers has bought the London-based commodities trading unit of French bank Natixis, in the latest move by Chinese institutions to expand into natural resources markets.

Western banks that trade raw materials face increased regulatory and political pressure, with some market leaders such as JP Morgan considering selling, spinning off or clinching strategic partnerships for their commodities desks.

A statement posted on the Shenzhen stock exchange website said GF Securities' wholly owned subsidiary, Hong-Kong GF Futures, acquired British firm Natixis Commodity Markets for US$36.1 million.

Chinese companies have long been expanding into commodities trading amid booming demand for resources at home. Chinese oil firms have amassed powerful trading desks in Europe and the United States.

But while China's massive demand for resources, fuelled by its rapid industrialisation, has underpinned worldwide markets for everything from oil to iron ore, Chinese banks have been relatively slow to embrace commodities trading.

Last week, sources said South Africa's Standard Bank was in talks to sell its London commodity trading business to its biggest shareholder, Industrial and Commercial Bank of China.

Last year, Bank of China became the first Chinese member of the London Metal Exchange.