SPD to tap UK market with its first London branch
Bookmark Share Words Contact Writer Bloomberg Shanghai Pudong Development Bank on Tuesday opened its first London branch, the latest in a series of Chinese banks opening offices in the city.
Four other Chinese banks have established London branches in the past four years, and there is one more in the pipeline.
In London, SPD Bank will initially provide corporate banking services, such as corporate loan and foreign exchange services. Chinese companies expanding into the United Kingdom are expected to be the bank's earliest clients in London, but over time, SPD Bank also hopes to recruit new UK clients.
In the longer term, the bank also looks to offer more innovative products and services, including cross-border clearing and targeted products in financial technology and green finance.
Chen Xin, general manager of SPD Bank's London branch, said London remained important as a global financial hub, "due to its concentration of a diverse range of financial companies, experienced financial sector talent and investors from all over the world." SPD Bank was incorporated in Shanghai in January 1993 and was listed on the Shanghai Stock Exchange in 1999. In 2016, SPD Bank's revenue reached 160.79 billion yuan ($25.61 billion), representing 9.72 percent year-on-year growth.
Wang Cong, a professor of finance at China Europe International Business School, said SPD Bank's expansion into London makes sense. He said the fact that a large portion of London's financial transactions serve international markets makes the city a suitable location for SPD Bank to serve its clients in international activities.
Ben Robinson, a senior economist at the London-based think tank Official Monetary and Financial Institutions Forum, agreed adding that the UK remains attractive despite uncertainty over the UK's departure from the European Union.
"The overall attractiveness of the UK means Chinese banks can use it as a base to increase their operations in the US, the Middle East, Africa, Asia and other areas that Chinese companies are expanding into," Robinson said.
"The UK is also a key center for research and development and technology, which Chinese firms are likely to remain interested in. Banks will need to be able to serve these customers," he added.
Prior to SPD Bank, five Chinese banks already had branches in London.
Bank of China, the earliest to establish a London branch in 1946, has become a respected player in London and its general manager Sun Yu is chairman of the UK's Association of Foreign Banks.
More recently, China Construction Bank, Industrial and Commercial Bank of China, China Merchants Bank and Bank of Communications have all opened branches in London.
Agriculture Bank of China is preparing to launch its London branch soon.