Chinese regulator for Citigroup`s expansion in China: Report

Last Updated: Wednesday, September 30, 2009 - 14:02

New York: A top Chinese regulator for
foreign banks has said Citigroup should expand its local
operations in China, according to a media report.

Citi`s China unit was "very prudent and careful" amid the
global financial crisis and now should be "expanding,
absolutely," Yan Qingmin who is the director of the Shanghai
branch of the China Banking Regulatory Commission and one of
the top regulators for overseas banks told The Wall Street
Journal.
Meanwhile, last week a media report noted that Citigroup
is scaling back its operations in the US to only six major
metropolitan areas.

Yan said Citigroup should take advantage of growth in the
Chinese economy and expand in the world`s most populous
nation.

He said Washington`s support for Citigroup was the
correct decision and the result has done little to alter how
Chinese policy makers regard the financial services giant.

"Regarding the US government bailout of Citigroup, I
think the American government measures were urgently needed,"
he said to the WSJ, adding, "They were very timely. At that
moment, what we needed most was confidence".

The comments suggest that Washington`s 34 percent stake
in Citigroup, amassed after offering USD 45 billion in support
this year, is not a worry for Chinese regulators, and perhaps
is a source of comfort.

China`s own banking industry is controlled by the state,
with a Communist Party appointee at the helm of major
institutions.
The report noted that Citigroup`s global operations lost
USD 27.68 billion in 2008, but its business in China remained
healthy. Net profit from its China operation, which includes
stakes in local banks, nearly doubled last year to the
equivalent of USD 191 million.

According to the publication, Citigroup has expanded its
base in China over the past year, but not as much as other
foreign banks.

At the end of June, its loan-to-deposit ratio of just USD
6 in loans for every USD 10 in deposits was among the most
conservative in the industry, he added.

The report citing a statement from Citigroup said "China
remains one of Citi`s top priority markets anywhere in the
world. Our business in China is performing strongly and we
continue to pursue growth across all lines of business."

Bureau Report



First Published: Wednesday, September 30, 2009 - 14:02

More from zeenews

 
comments powered by Disqus