Money

Standard Chartered to start co-op with ABC in HK

(Agencies)
Updated: 2010-07-16 14:14

Standard Chartered Plc, which invested $500 million in Agricultural Bank of China Ltd's initial public offering, plans to start a cooperation agreement with the Chinese lender by offering advice on capital markets business in Hong Kong.

"We're planning to initiate the first phase in the Hong Kong market,"Jaspal Bindra, chief executive officer for Asia at Standard Chartered, said in an interview with Bloomberg TV on July 14. "That's the market where there are most advanced talks and we would like to go further."

Special Coverage: Focus on ABC's IPO Plan Related readings:  ABC shares open 1.56% higher in HK debut  ABC shares make a modest debut  Agricultural Bank of China says HK IPO 5.87 times oversubscribed  Agbank profit up 40% to 46b yuan

Agricultural Bank's IPO makes China home to four of the world's 10 biggest banks by market value, half a decade after the country's first major State-owned lender went public. The investment allows Standard Chartered, which makes most of its profits from emerging markets, to speed up growth in the world's most populous nation by partnering with China's largest bank by customers.

"Standard Chartered has always held the philosophy that we are not one for passive investment,"said Bindra. "So we would only like to make an investment where we can leverage that with some level of participation, and I think Agricultural Bank offered us that opportunity."

London-based Standard Chartered aims to boost its branch network in China to about 70 by the end of the year, Bindra said. The bank currently has 56 outlets in the country.

Agricultural Bank has "a high appetite both for internationalization and expanding their product range,"he said. The Chinese lender will gain access to the global network of Standard Chartered, which includes operations in 14 African countries, according to the executive.

Agricultural Bank rose 0.8 percent on its debut in Shanghai yesterday, the smallest first-day trading gain among the nine lenders that have sold shares in the city in the past four years. The bank starts trading in Hong Kong today.