Citi wins approval for wholly owned securities firm in China

Citi has received approval from the China Securities Regulatory Commission to establish a wholly owned securities company in China, the bank announced on 23 October. Citigroup Securities (China) Co., Ltd. will be headquartered in Shanghai and will offer equities brokerage, securities underwriting, securities research and principal trading to domestic and foreign clients.

The licence extends Citi's onshore capabilities beyond its existing offshore franchise, allowing it to underwrite capital markets deals locally and give clients direct access to Chinese stock exchanges, as well as trading in onshore listed shares, bonds and funds. Citi said it will now complete the statutory and regulatory procedures needed to establish the company and prepare for operations.

Jane Fraser, Citi chair and chief executive, said the bank had served clients in China for nearly 125 years and thanked regulators for supporting the expansion. She said that by adding onshore capabilities to its global platform, Citi would be able to do more for clients in China's domestic capital markets, including helping them raise capital, access investors, and trade locally, while connecting them to opportunities around the world.

Wenjie Zhang, Citi China country officer and banking head, said the securities company would be an important part of the bank's China strategy and that it would focus on building a high-calibre local team and leveraging its global network to support domestic capital market development. Citi said it serves 70 per cent of Fortune 500 companies operating in China and has helped Chinese clients raise more than $40 billion in global capital markets year-to-date.

The approval is the latest step by an international bank to build a fully owned onshore presence in China's capital markets, a route that has opened gradually as foreign ownership limits in the securities sector have been relaxed.