Opinion | ICBC expands in Middle East

ICBC's latest expansion in the Middle East marks a broader international drive that could make the bank a top global player in the next 5-10 years.

Photo: Xinhua
ICBC (1398.HK; Shanghai: 601398) is easily China's most outward-looking bank, and it is showing its global aspirations once again with word that it plans to open branches in the Middle Eastern markets of Saudi Arabia and Kuwait. This latest announcement that it has received local approval to set up branches in these two lucrative markets comes just a week after ICBC said it has also received local regulatory approval to buy a controlling stake in the Argentine unit of South Africa's Standard Bank, its longtime partner in Africa.

For anyone looking at long-term banking plays in China, ICBC certainly seems like a good bet due to its strong focus on emerging markets, trade finance and yuan-related services, three big growth areas where Chinese banks enjoy a strong natural advantage over their western peers. But in the shorter term, ICBC and its other major domestic competitors will have to face more serious problems in their home market that still accounts for the big majority of their business.

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