China - October 03, 2024

Foreign securities firms expand their presence in China

(Voice_over)

Since the foreign ownership cap was lifted in 2020, the presence of foreign firms has been growing in China.

Earlier this year, BNP Paribas Securities became the fourth wholly foreign-owned securities firm approved by the China Securities Regulatory Commission – joining J.P. Morgan, Goldman Sachs, and Standard Chartered.

To learn more about how foreign-owned securities have been doing since their entry, I spoke with Lu Fang, Chairperson of J.P. Morgan Securities China – the first of its kind in the country.

(Sound_bite)

Lu Fang, Chairperson, J.P. Morgan Securities (China) Co. Ltd.:

"As a young company, we've achieved three consecutive years of profitability. Our four licensed businesses, including investment banking, securities brokerage, proprietary trading, and securities research, have all grown steadily. This growth is closely tied to China's ongoing financial market opening, providing greater development opportunities for all market participants, including foreign firms. "

(Voice_over)

She also mentioned the growing trend of Chinese companies going global, with J.P. Morgan aiming to bridge China and the global capital markets, leveraging its expertise to support this cross-border growth.

(Sound_bite)

Lu Fang, Chairperson, J.P. Morgan Securities (China) Co. Ltd.:

"The establishment, growth, and development of J.P. Morgan Securities (China) has been made possible by China’s financial market reforms and opening-up policies. Riding the wave of removing foreign ownership restrictions in the securities and futures sectors, we eventually became the first fully foreign-owned securities in China. We believe that as relevant authorities continue to enhance policy transparency and predictability, it will help all market entities including multinational companies better manage risks, serve clients, and further increase China's appeal to global investors."

(Voice_over)

According to the latest data from Chinese financial authorities, ten foreign-controlled securities firms, nine wholly foreign-owned fund management companies and three foreign-controlled future firms have been approved to operate in China.

The entry of foreign-owned securities companies, known for their mature investment banking and wealth management expertise, could reshape China’s financial landscape.

Industry insiders believe their presence will drive more diverse and competitive offerings which will eventually benefit investors.

As policies continue to improve, China can expect more foreign firms to establish themselves here, bringing a wider array of financial products and services to the market.

[Restriction: No access Chinese mainland]