China Direct

HSBC announces new Shanghai Fintech Service Hub

 

CBI member, HSBC has announced that it plans to open a fintech services company in Shanghai.

The planned firm will provide technology and data services to the group's licensed financial institutions and will also research and export financial technology solutions to other financial institutions at a proper time later.

The project was announced during a signing ceremony for foreign-funded projects in Shanghai last Wednesday.

Mark Wang Yunfeng, CEO, HSBC China said: “We are very honoured to be able to reach cooperation with the Shanghai Lingang New Area […] with HSBC's years of international financial service experience, HSBC hopes it could continue to contribute to the innovative development of China's economy.”

HSBC has stepped up its investment in Mainland China. In addition to HSBC’s new fintech venture, HSBC Life China, its life insurance joint venture, has started offering a new mobile financial planning and insurance service to clients in Guangzhou and Shanghai.

Greg Hingston, regional head of wealth and personal banking, said the investments: “mark HSBC’s continued efforts to capture high growth opportunities in Asia, particularly in mainland China, the region’s biggest wealth pool and one of the world’s largest insurance markets”.

CBI members HSBC and BNP Paribas announce China ‘green loans’

 

 

CBI members, HSBC and BNP Paribas have been announced as joint lead arrangers for an inaugural green loan to be offered by Industrial & Commercial Bank of China through its London branch. The announcement was made during the 10^th UK – China Economic & Financial Dialogue, which took place in London on Monday.

According to the mandate letter, the loan will be structured through a dual currency term loan facility, and will be traded in both British pounds and US dollars. ICBC hopes to raise up to $400 million with this loan for investment into green projects.

Paul Yang, head of BNP Paribas Greater China, said “The signing of the mandate letter represents a landmark moment for sustainable finance in China.” The arrangement of the loan marks the first Green Loan Principles-compliant loan facility to be structured for a Chinese bank.

Daniel Klier, global head of sustainable finance of HSBC said “The funding demonstrates HSBC’s commitment and dedication to the green loan market, which we are determined to support and develop. This is part of our commitment to provide $100 billion in sustainable financing and investment by 2025.”

 

 

Companies lining up to list on London – Shanghai Stock Connect

 

One of China’s biggest brokerage companies has announced that it plans to raise as much as $2bn when it becomes the first Chinese company to list in London as part of the long-awaited London-Shanghai Stock Connect.

Huatai Securities, a Nanjing-based company, and one of the biggest brokerages in China, announced on Tuesday that it plans to use the new link between the two market centres to offer 82.5 million global depository receipts, to be priced between $20 and $24.5. The sale is expected to raise between $1.7bn and $2.02bn and the number of GDRs will represent about 10% of the company’s outstanding share capital.

In a press release, Huatai Securities announced that “conditional dealings” in London are expected to being on or around June 17^th, the date of the UK – China Economic & Financial Dialogue, where financial services providers from both countries are hoping announcements expanding the scope of business dealings between the UK and China will be made.

CBI members, J. P. Morgan and Morgan Stanley are joint global co-ordinators with Huatai Financial Holdings in Hong Kong. HSBC Bank is also involved.

 

 

HSBC to add 1,000 Tech R&D jobs in China

 

 

CBI member, HSBC has announced plans to add 1,000 jobs in research and development centres in Guangzhou, Shanghai and Xi’an as it looks to expand its presence in China. HSBC says that it plans to spend up to US$3.5 billion a year on strengthening its technological operations and capability in FinTech.

By adding an additional 1,000 jobs to its current China-based headcount, HSBC’s workforce in-country will increase by 14%. HSBC currently employs 7,000 in Mainland China.

HSBC chief information officer, Darryl West said, “There is a lot more [HSBC] can do with technology in mainland China. The level of technology adoption and innovation in China is way ahead of other markets. {HSBC] see mainland China as a tremendous source of talent, not just for the local market but our technology operations globally. We are hiring very aggressively here.

HSBC plans to use its China-based technology centres to develop banking products for its global network, such as the bank’s UK mobile banking app – which is currently being developed and updated out of the bank’s Xi’an R&D site.

The bank’s investment in financial innovation in China comes in tandem with plans to invest US$15 billion in the next three years into China, as the central government eases restrictions on foreign ownership. Despite the limited physical presence of foreign banks in China compared to dominant domestic rivals being a challenge, HSBC generated nearly 40% of the bank’s revenue in Mainland China and Hong Kong last year.

The bank has identified the fact that consumers in China have embraced technological payment solutions in China in greater numbers than in the West as the main cause of their success in the market. HSBC hopes that further investment in technology and developing a wider portfolio of technology-based products will continue to negate the bank’s lack of a physical presence.

HSBC first to offer dementia-friendly banking service in Hong Kong

 

CBI member HSBC has introduced a new type of bank account in Hong Kong aimed at serving customers with dementia, a growing public health concern among the city’s rapidly ageing population.

The “HSBC basic banking account with independence” scheme, which was originally tried and tested in the UK, enables customers living with dementia to retain access to a bank account, but one with limited features and additional control by a legal designee.

Greg Hingston, head of retail banking and wealth management in Hong Kong said at the launch of the service yesterday “[HSBC] wants customers with diminished mental capacity to continue to be able to manage their finances safely and with an appropriate degree of independence. […] there is a definitely a need, and when you look at demographics that’s just going to become more material going forward.”

Dementia is an increasing health concern as Hong Kong’s population grows older, with nearly a third of the city’s residents expected to be aged 65 or older in 20 years’ time. According to Hong Kong’s Hospital Authority, in 2017 between 20 to 30% of Hong Kong residents over the age of 80 suffered from dementia disorders such as Alzheimer’s disease.

HSBC’s new scheme is meant to guard against financial mismanagement by customers with impaired mental capacity, who face challenges understanding bank documents, remembering pins, and communicating with bank staff. The new account relies on existing Hong Kong laws enabling third party control of accounts for those with impaired mental capacity, either through enduring power of attorney, or via a guardianship order issued by the courts. Third parties would take control of accounts and top up the basic banking account.

HSBC launches new Navigator: Made for China report at CIIE

 

HSBC took to the stage at the China International Import Expo. to launch its latest report on Chinese consumer tastes. Titled Navigator: Made for China, the report seeks to provide manufacturers with an understanding of changing Chinese consumer tastes and where there may be opportunities within the China market.

The report contains good news for British manufacturers. After several days of campaigning behind the slogan ‘Britain is GREAT,’ and pitching to potential Chinese clients that British products can be easily distinguished in China because of their quality, British manufacturers should be encouraged to read that HSBC affirms that international businesses selling into the China are successfully distinguishing themselves through the unique quality of their products.

Building on this idea that manufacturers must focus their attention on quality, the report also pays attention to the changing demographics of the China market and sign-posts how this shift is affecting the practicalities of selling into China. The report encourages manufacturers to focus on younger consumers who are after high-quality products that integrate advanced technological components.

According to HSBC’s Head of Commercial Banking, Asia Pacific ‘[manufacturers] all recognise the rapidly growing importance of the Chinese consumer and [the fact] that it’s really the young, affluent Chinese that are driving this consumerism.’

HSBC is confident that more and more manufacturers will find success selling into China, and at the launch of the report, Helen Wong, Chief Executive, Greater China said: ‘[the report is] talking about the middle class. At the moment it is around 400 million and could grow to 850 million by 2030.’ However, the report clearly points out that it is important that foreign firms focus on the needs of this growing demographic and avoid being blinded by its size. Ms. Wong continues to make the point that ‘foreign firms [must] understand the aspirations of younger Chinese consumers who are selective about brands, increasingly health conscious, and concerned about the environment.’ With that in mind, the report highlights opportunities for high-end manufacturers of consumer electronics and intelligent equipment.

Finally, the report stresses the need for international manufactures to work harder to understand local business culture so that they can form effective partnerships enabling them access to China through distribution agreements with local companies and establishing a presence on China’s e-commerce sites.

Please read the full report here.

Please read more about HSBC’s ‘Made for China’ initiative at the CIIE here.

HSBC set to become first foreign company to list in China

 

After almost ten years of trying, it seems that CBI member, HSBC is about to make its debut on the Shanghai stock exchange.

The bank will participate in ‘London-Shanghai Stock Connect’ resulting in HSBC stock being offered in Shanghai in the form of Chinese Depository Receipts – a tradeable security that reflects underlying shares held elsewhere.

Whilst the listing is viewed as predominantly symbolic, it takes on wider practical meaning as it marks the first time that Chinese investors can trade a foreign company in their own market.

The London-Shanghai Stock Connect programme is one of a series of schemes aimed at linking up China’s public equity market with those of other countries. Under the scheme, global investors will have access to shares in Chinese companies and Chinese investors a chance to buy stock listed on the London Stock Exchange.

The link is not expected to open until the end of this year, but HSBC is confident that the scheme will launch successfully, and that by doing so demonstrate a change in the Chinese Government’s attitude towards opening the country’s stock market to international investors.

HSBC expects to double staff in China Securities Venture

HSBC Qianhai Securities Ltd., the first foreign majority-owned securities joint venture in China, expects to more than double the size of its team in the next four years as it sees economic growth continuing to attract investments to the country.

The firm, launched last year to help institutional clients access Chinese capital markets, expects to have 300 staff, up from 120 currently, Chief Executive Officer Irene Ho said in an interview in New York on March 5. “I just need to see the money coming in,” she said.

London-based HSBC Holdings Plc received approval in June to invest 918 million yuan ($145 million) for 51 percent of a venture with Qianhai Financial Holdings Co. The venture conducts equity research and brokerage activities on locally listed securities, equity and debt underwriting and sponsoring, and advises on domestic and cross-border corporate mergers and acquisitions.

Please read more here.

(news courtesy of Bloomberg)

CBI Sterling Assets Report on China Roadshow

 

  

The inaugural Sterling Assets Report has been on a pan-China Roadshow since its launch on Thursday 02 November in Beijing.

The objective of the Roadshow was to circulate the Report's key findings to the diverse and dynamic UK business network in China and encourage policymakers and local officials to use the Report to promote greater UK-China business investment. 

Additionally the Report was received by business stakeholders the CBBC, British Chambers, Department of International Trade (DIT) and a visiting delegation of the All Party Parliamentary China Group in Guangzhou.

China Direct would like to sincerely thank HM Consuls Cecile Elbeleidi in Chongqing, HM Consul Karen Maddocks in Guangzhou, HM Consul John Edwards in Shanghai and HM Consul Nick Whittingham in Wuhan for their support.

 

    

Please note that China Direct will have the Chinese language version of the Report available for review and download by mid-November.

Kindly find the original Report and Executive Summary attached below for your reference.

Download CBI China Sterling Assets Report

Download Sterling Assets China Executive Summary

Thank you. 

  

UK Ahead Of The Curve In China Investment Strategy - CBI

 

EMBARGOED: 00:01 Hours, Thursday 02 November, 2017UK AHEAD OF THE CURVE IN CHINA INVESTMENT STRATEGY – CBI

UK is China’s second largest European trading partner  

The UK is shifting its investment into inner regions of China and into new sectors, ahead of the curve of other nations, according to the CBI’s first ever Sterling Assets China report.

Download CBI China Sterling Assets Report

In 2016, the UK was China’s second largest trading partner in the European Union (behind only Germany) and the eighth worldwide, doing £55 billion worth of trade in goods with China. Indeed, after the USA and Germany it is the only country in the list of China’s top nine trading partners not in the Asia Pacific region.

The UK also ranks eighth in terms of foreign direct investment (FDI) into China over the last decade, at £4 billion. However, unlike other nations, Great Britain is shifting its focus from coastal to inland provinces, which have historically received a smaller share of FDI, so as to mirror the Chinese government’s Belt and Road development plans. Over half (57%) of British investment in 2015 (over £880 million) went to inland regions, led by Heilongjiang (£313 million) in the north east and Henan (£276 million) in the centre.

Of the £18.1 billion worth of UK exports to China in 2015, Shanghai tops the list (£4.2 billion), followed by Beijing (£2.4 billion) and Guangdong (£1.3 billion). 21% of British exports to China were in transport technology (automotive, rail, air and maritime), 12% in machinery & electrical, 8% in chemical products and 5% in metals. The UK’s top service export was travel (£1.5 billion), with 270,000 Chinese visiting the UK and 91,000 Chinese students enrolling in British universities – far more than from any other country.

Guy Dru Drury MBE, CBI Head of China, said:

“The Sino-British relationship is a great success story. As we delve deeper into the Golden Era of ties between China and the United Kingdom, we have so much to offer each other, and British business is keen to play its part.

“From cars to chemicals, and services to schools, British organisations – especially many smaller companies – are tapping into a growing market in China, one that plays to the UK’s best competitive strengths. With the consumer market worth over £3.3 trillion, instantly recognisable British products are a particularly strong match for a growing generation of affluent Chinese. Moreover, this relationship creates thousands of jobs in the UK and China, raising living standards and boosting productivity.

“As the UK forges a new global trading future, it is well ahead of the curve in making the most of its relationship with the world’s fastest growing economy. By making inroads into China’s lesser economically known regions, the UK stands to profit from China’s move from manufacturing and infrastructure into technology and services.”

Dame Barbara Woodward DCMG OBE, Her Majesty’s Ambassador to the People’s Republic of China, said:

“Supporting UK-based companies to invest and operate overseas and become global businesses is part of our strategy to expand mutually beneficial trading relationships around the world. This is especially so in China, the world’s second largest and fastest growing economy.

“This report showcases a wide range of British investment and highlights the strengths and growing confidence of British companies. Investment in China by British companies can generate wealth for the UK, support British jobs, help build UK-based supply chains, and support China’s own economic development.

“As we continue to address the challenges for businesses investing across the globe and help them to make the most of opportunities, positive and proactive engagement of UK and Chinese businesses remains vitally important.”

Between 2015 and 2016, greenfield project investment into China exceeded £2.25 billion. The financial services sector saw the highest value investments (£488 million), followed by logistics (£292 million), consumer products (£268 million) and business services (£209 million).

02 November 2017

Notes to Editors:

Across the UK, the CBI speaks on behalf of 190,000 businesses of all sizes and sectors. The CBI’s corporate members together employ nearly 7 million people, about one third of private sector-employees. With offices in the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world.

The CBI 2017 Annual Conference will take place on Monday 6th November at the NEW LOCATION of the InterContinental London – The 02 hotel. Media can now register here (clicking on the “Media” box, entering the code 7286). Please note that journalists will be asked to upload a photo as part of the registration process. The closing date for applications is Thursday 02 November.

Follow the CBI (@CBItweets) on Twitter and on the day of annual conference using the hashtag #CBI2017.

Media Contact:

CBI Press Office is available 24 hours a day on 0207 395 8239, or email: [email protected]. Follow the CBI (@CBItweets) and CBI China (@CBIBEIJING) on Twitter.