China Finance

China’ s Construction Bank (CCB)

• China Construction Bank (teamed up with Xiangcai Securities) has become the first mainland financial institution to offer securities-backed loans to stock brokerages (March 2, 2000)
• The bank offers the firms short-term loans secured by shares and securities investment funds.
• Traditionally, most brokerages illegally dipped into clients' funds to finance daily operations but a crackdown on the practice last year has left many firms strapped for cash.

Commercial bank

• The Communications Bank of China
• established in 1987
• support modernization of China
• Deal with both RMB and foreign currency deposits and loans
• Operate the securities market

Foreign banks

• Foreign owned and joint venture banks are allowed to operate in China since 1970s
• Book loans denominated in foreign currencies
• collect bills and remittances from overseas
• discount foreign exchange bills
• handle documentary credit arrangement
• conduct credit checks
• accept consulting engagement
• offer safe deposit services

The Bank of China agrees to provide renminbi loans to HSBC and Standard Chartered to bolster the business of the two British banks in the Chinese market (10/22/99 FT) -- as a good will by the Ziang Zemin’s UK trip

• The Bank of China agrees to provide renminbi loans to HSBC and Standard Chartered to bolster the business of the two British banks in the Chinese market (10/22/99 FT) -- as a good will by the Ziang Zemin’s UK trip
• The deals are expected to total Rmb 3bn ($362m) apiece, making them the largest such loans granted to foreign banks in China since the rules on funding lending business there were relaxed last summer.
• The deals should give the two banks an edge in the Chinese market because they will have more money to lend to corporate customers operating in China than their competitors, all of whom have faced difficulties raising renminbi in the local market.