Bank of China granted banking licence on eve of Xi visit

The world’s 7^th largest bank*, the Bank of China announced that it has been granted its banking licence from the Reserve Bank of  and will formally launch its business at a special ceremony in Auckland on Friday.

The granting of the banking licence will allow the Bank of China to meet the growing demand for the significant reciprocal trade opportunities between New Zealand and the People’s Republic of China (PRC).

As New Zealand’s biggest trading partner, China is important to New Zealand’s economic growth and since the signing of the world’s first free trade agreement with PRC in 2008, the increase in reciprocal trade has been significant rising from NZ$2.3 billion (2008) to NZ$18billion (2013).

The Executive-director of the Bank of China (New Zealand) Limited David Wang Lei says he is very pleased with the progress to date, having established the New Zealand business and secured a banking licence.

“Bank of China is China’s premier international trade bank with our core business being corporate banking and financial markets services. We are delighted to have received our banking licence from the Reserve Bank of New Zealand which will take effect from Friday 21 November. We are open for business and looking forward to introducing the Bank of China to customers in New Zealand, especially those that are doing or thinking of doing business with China.”

Chris Tremain, Chairman of the Bank of China (New Zealand) Limited, says that the decision to establish the business in New Zealand was a logical step in the growing harmonisation of trade relations between both countries.

“The Bank of China sees this as the ideal time to launch their New Zealand business, contributing towards the combined trade of both New Zealand and China to an expected $30 billion per annum by 2020. Bank of China will support its existing clients to invest in New Zealand and help New Zealand clients to expand into China and around the world. Bank of China has an international network in 40 countries that will support many New Zealand businesses to grow their footprint in offshore markets,” says Tremain..

Tremain adds that the Bank of China is particularly keen to support the New Zealand agricultural sector to grow exports to mainland China. “Bank of China is particularly strong in its agritech business and given that a third of all New Zealand’s exports to China are dairy products, this bodes very well.  However in general, exports to China are also becoming more diversified to include not only primary products (wine, wool, meat) but also machinery, aluminium, and high technology products.”

Bank of China has many well-known corporate clients who have invested in New Zealand or are conducting business in this country such as COSCO, Bright Dairy, Huawei and Haier Group.

The New Zealand Board of the Bank of China also includes former Minister of Finance Hon. Ruth Richardson.

The Bank of China which officially launch its New Zealand operations at a reception at the Langham Hotel in Auckland on Friday.

*According to The Banker, a British magazine (part of the Financial Times Group) released its rankings of the “Top 1000 World Banks” for 2014. BOC was ranked 7th by tier-1 capital totalling US$149.729 billion, up 23% over 2013.

 

About Bank of China (http://www.bankofchina.com/nz/ )

Bank of China (BoC) was established in 1912 and until 1949 served as the country’s central bank, international exchange bank and specialised international trade bank. Fulfilling its commitment to serving the public and developing China’s financial services sector, the Bank rose to a leading position in the Chinese financial industry and has an excellent standing in the international financial community.

The Bank’s core business is commercial banking, including corporate banking, personal banking and financial markets services.

After 1949, with a long history as the state-designated specialised foreign exchange and trade bank, the Bank became responsible for managing China’s foreign exchange operations and provided vital support to the nation’s foreign trade development and economic infrastructure through its offering of international trade settlement, overseas fund transfer and other non-trade foreign exchange services. During China’s reform period, the Bank seized the historic opportunity presented by the government’s strategy of capitalising on foreign funds and advanced technologies to boost economic development, and became the country’s key foreign financing channel by building up its competitive advantages in foreign exchange business.

In 1994, the Bank was transformed into a wholly state-owned commercial bank. In August 2004, Bank of China Limited was incorporated. The Bank was listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange in June and July 2006 respectively, becoming the first Chinese commercial bank to launch an A-Share and H-Share initial public offering and achieve a dual listing in both markets. In 2014, Bank of China was enrolled again as a Global Systemically Important Bank, becoming the sole financial institution from non-OECD economies to be enrolled for four consecutive years.

As the most internationalized bank in China, the Bank has led the RMB offshore market development, and is becoming the primary channel of RMB cross-border circulation, main driver of RMB internationalisation, and the leader in RMB internationalisation products and services innovation.

The Bank maintained its market leading position in cross-border RMB settlement volume. In 2013, the Bank’s cross-border RMB settlement volume was over RMB3.98 trillion, of which RMB1.77 trillion was attributed to the Bank’s domestic institutions and RMB2.22 trillion was attributed to Hong Kong and other overseas institutions, achieving an overall year-on-year growth rate of 60.2% and the Bank maintained the market leading position. Since China launched its RMB cross-border settlement scheme, the Bank had completed cross-border RMB settlement volume of RMB8.6 trillion. Apart from Hong Kong, Macau and Taiwan, the Bank is also the RMB clearing bank of Malaysia, Luxembourg, Cambodia, Philippines and other countries and regions, and serves as RMB market maker in Russia. In addition, the Bank has become the main RMB clearing channel in countries and regions such as the UK, Germany, France, Australia, Japan, South Korea, Indonesia and South Africa.

The Bank has been continuously innovating RMB financial products and improving its cross-border RMB services. The Bank has built a full range of onshore and offshore RMB financial products including RMB trade settlement, clearing, deposit, loans, treasury trade, trade finance, bond, cash management, etc. The Bank has successfully consolidated its position of the main banking channel of RMB global distribution and use.