CBN Extra Topics

HSBC happy with BoCom as China investment vehicle: CEO

HONG KONG (Reuters) - HSBC Holdings is happy with its stake in Bank of Communications as its primary investment vehicle in China, HSBC's chief executive said on Monday.
Speaking in an interview on CNBC, HSBC chief executive Michael Geoghegan made his comments after Britain's Sunday Telegraph reported that the British lender was considering a bid for a major Chinese bank to reinforce its presence in the country as other foreign lenders retrenched.
The Telegraph said HSBC, Europe's biggest bank, wanted to buy a majority stake in one of China's big three lenders - ICBC ,Bank of China ]or China Construction Bank.

Chinese investment regulations limit the holdings of foreign banks in domestic lenders to 20 percent.
HSBC owns just under 20 percent of Bank of Communications, China's fifth-largest lender.
Asked about his interest in one of China's top three lenders, Geoghegan declined to directly comment on the issue, but reiterated that Bank of Communications was HSBC's primary China investment.
"We are happy with our investment in Bank of Communications. That's what I am saying. It's our principle investment in China," Geoghegan, who relocated to Hong Kong last week from London, told CNBC in an interview.
Even if it wanted to buy control of one of the big three banks, it would have to wait until China relaxed the 20 percent stake limit, Geoghegan said, adding that there were no discussions with Chinese regulators on allowing investments above 20 percent.
"We are not talking to Beijing about an increase at the current time over the 20 percent, as you know it's a regulatory top limit you can have and it's up to the Chinese authority to change that as they wish," he said. "If they change it I suspect they will change it for the whole banking industry, but we are not asking them to change that for the current time."

Posted by CBN Extra Staff on 04 Feb 2010 [07:08] | Comments 0 |