-
-
Invest Shanghai
Four newly established foreign financial institutions, spanning the securities and reinsurance sectors, inaugurated operations in Shanghai on Wednesday. The collective launch, including a securities branch of BNP Paribas in China, underscored foreign investors' long-term commitment to China's market amid the country's deepening financial reforms, a Chinese expert said.
BNP Paribas' wholly owned securities brokerage in China, with registered capital of 1.1 billion yuan ($152 million), is the fourth wholly foreign-owned securities firm in the country. The firm will conduct a range of businesses, such as securities brokerage, securities proprietary trading, securities investment consulting and securities asset management, the Shanghai-based Jiefang Daily reported on Wednesday.
"We will leverage international expertise and resources to expand services tailored to Chinese clients' needs, contributing actively to the development of China's capital markets," said Guo Zhiyi, head of BNP Paribas Securities China, according to Jiefang Daily.
The Shanghai International Reinsurance Registration and Trading Center, China's first international reinsurance trading platform, was also inaugurated on the same day. Designed to drive reinsurance market liberalization, enhance risk management capabilities and support the Belt and Road Initiative, the center aligns with a national policy unveiled in August 2024 to build Shanghai into a globally competitive reinsurance hub.
"We are long-term bullish on China and Shanghai. We aim to bridge the domestic and international markets, leveraging China's new quality productive forces to fuel growth," said Wang Yan, head of Hannover Re Shanghai, according to Jiefang Daily.
These remarks showed that foreign-funded financial institutions are optimistic about the Chinese market and the attractiveness of China's high-level financial opening to foreign investment, Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times on Wednesday.
The entry of foreign-funded financial institutions will facilitate the flow of capital at home and abroad, enhance the internationalization level of China's financial market, and strengthen the linkage between the Chinese market and the international financial market, Wang said.
Dong Shaopeng, a senior research fellow at the Chongyang Institute for Financial Studies at Renmin University of China, told the Global Times on Wednesday that foreign securities firms entering China enables them to share the growth dividends of China's financial markets. The entry of reinsurance companies can provide back-up services for insurance companies, further strengthening this sector, which is crucial for the stable development of China's insurance industry.
China has been promoting an open-minded attitude toward foreign financial institutions in terms of equity requirements, approval processes and shareholding ratios while maintaining an equal treatment approach with their Chinese counterparts, Dong said.
"Right now is an excellent time for foreign financial institutions to seize the opportunity and set up branches in the country," Dong said.
These developments follow China's January release of 20 measures to advance financial opening in pilot free trade zones including Shanghai as well as the Hainan and other important cooperative platforms.
The guidelines aim to better align China's financial sector with international standards and advance institutional opening-up of the sector, granting foreign financial institutions same treatment as their Chinese counterparts when providing new financial services not available in the country at that stage.
Valid applications filed by financial institutions and cross-border financial services providers concerning financial services will be processed within 120 days, as per the document.
The country will also support the purchase of certain types of cross-border financial services, facilitate inbound and outbound fund transfers related to foreign investment, improve arrangements for cross-border flows of financial data, and strengthen regulation of this sector, the guidelines said.