Citi wins approval to establish wholly owned securities firm in China

Photo: Citi Bank/Linkedin

BAKU, Azerbaijan, October 23. Citi has secured regulatory approval to establish a securities business in mainland China, opening the way for the US banking group to expand its capital markets services within the country.

According to the company announcement, the new entity, Citigroup Securities (China) Company Limited (CSCCL), will be based in Shanghai and operate as a wholly owned subsidiary. Before it can begin business, Citi must complete the remaining statutory and regulatory procedures.

The license will enable Citi to provide services including stock trading, securities underwriting, market research and principal trading to Chinese and international clients. The move will add local capabilities to the bank’s existing global platform, allowing it to support clients with domestic transactions as well as cross-border investment and financing.

Citi has operated in China since 1902, building a client base that includes multinational corporations, major Chinese businesses and public-sector institutions. The bank says it serves 70 percent of Fortune 500 companies operating in the country.

Its new securities business is intended to complement the services already provided by Citi’s Corporate and Investment Bank and Commercial Bank. It will give corporate and institutional clients an additional channel for accessing China’s stock exchanges and trading locally listed shares, bonds, funds and other financial instruments.

The approval also builds on Citi’s role in connecting Chinese companies with international investors. According to the bank, it has helped Chinese clients raise more than $40 billion through global capital markets since the beginning of the year. The new license will allow it to add domestic underwriting to its existing offshore capital markets offering.

Citi Chair and Chief Executive Officer Jane Fraser said the approval would strengthen the bank’s ability to serve clients in China and link their domestic activities with opportunities in international markets.

Wenjie Zhang, Citi China Country Officer and Banking Head, said the bank would focus on recruiting a strong local team and drawing on its international network to support clients and the development of China’s capital markets.