ExclusiveFitch Ratings tests Beijing promise to open up financial markets with new wholly owned China operation

Global credit ratings agency Fitch is testing Beijing’s promise that it will open its financial market to foreign institutions and looking to steal a march on its main global competitors in tapping the vast potential of China’s domestic market.

Fitch is taking the bold step of opening its wholly owned China venture ahead of receiving a government licence to do business, as it is convinced that Beijing is sincere in its pledge to open up the credit ratings sector and is eager to tap into the world’s third largest bond market.

Fitch Bohua, the onshore entity scheduled to be officially launched on Wednesday in Beijing, is expected to give the New York-based agency a head start over international rivals S&P Global and Moody’s.

“We are optimistic about the development of China’s bond and rating service market,” said Danny Chen, chief executive officer of Fitch Bohua. “Its bond market is expected to continue expanding in coming years and could become the world’s second largest, or even outpace the United States to become the largest, in the foreseeable future.”

“The opening up of China’s market is moving forward at the prescribed pace,” he told the South China Morning Post in an interview on November 1.