Chinese-funded Banks Enter the City of London – A Win-win Choice.doc

Chinese-funded Banks Enter the City of London – A Win-win Choice ON the back of China’s extraordinary economic growth， Chinese-funded banks have brought the country closer to its ultimate goal to “go global.” The breakout and spread of the international financial crisis challenged Chinese-funded banks， but at the same time brought unprecedented opportunities. The U.K.’s trade in the realm of financial services –second only to the U.S. – gives it a clear competitive edge. As an international financial center and the world’s largest trading market for foreign exchange， derivatives and securities， London constitutes a tailor-made environment for investment and finance. After a gradual entry into the City of London， Chinese-funded banks are heading rapidly towards internationalization. The consequent fastapproaching internationalization of the RMB will give Chinese enterprises the financing impetus they need to“go global.” It will at the same time promote Sino-British trade and speed up the U.K.’s economic recovery. Course and Operation The internationalization of Chinese-funded banks began almost 100 years ago. The Bank of China （BOC） first set up a London office， known as the “Bank of China London Agency，” in November 1929. BOCs first overseas office， the agency was also the first overseas financial institution ever formed by a Chinese bank， and hence a historical landmark. BOC later successfully opened four other U.K. branches， although the London office showed the best business performance. After the global financial crisis the U.K. imposed more stringent financial regulations. Under pressure from the Financial Services Authority（FSA）， BOC accordingly transformed its branches into subsidiaries. In October 2007 – 78th anniversary of the London Branch – the FSA approved BOC’s establishment of a U.K. subsidiary – the Bank of China （U.K.） Limited， with a registered capital of ￡200 million. During its four-year transitional period， BOC launched a“dual-tr