Citigroup plans China joint venture
Wednesday, 30 January 2008

Agence France-Presse . Shanghai

US-based Citigroup plans a Chinese securities joint venture as the Asian nation reopens its lucrative brokerage sector to foreign participation after a two-year pause, state media said Monday.

Under an agreement Citigroup signed Thursday with Central China Securities, the two will soon file an application to regulators for the establishment of the venture, the China Business News said, citing unnamed sources.

The report did not provide financial details of the deal, which would become Citigroup’s first securities joint venture in China. A Citigroup spokeswoman declined to comment on the report when contacted by AFP.

No comment was immediately available from Central China Securities, which is based in Zhengzhou, capital of Henan province in central China. China unveiled revised rules in late 2007 on foreign investment in domestic securities houses after a two-year suspension of approvals, aimed to allow time for the country’s brokerage sector to be overhauled.

Swiss banking giant Credit Suisse said earlier this month it would apply soon to form a joint venture with China’s Founder Securities, adding that it hoped to hold the regulatory maximum of 33.3 percent in the firm.

Chinese press reports have also said that US investment bank Morgan Stanley is planning a tie-up with Shanghai-based China Fortune Securities. Morgan Stanley has refused to comment.

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