Foreign banks retooling products for Chinese rich

"Rich people in China are keen to increase their wealth through investment," Xi said.

"Worth noting," he added, "is their awareness and willingness to invest overseas, which has surged in recent years, with more people sending children abroad for education, and emigrating."

China's economy has been booming for years, but its growth is slowing down.

On the other hand, the trend for the Chinese yuan to appreciate against the US dollar makes overseas assets more attractive to China's wealthy, he added.

In this regard, foreign banks, with global networks and long experience in global assets allocation, have an edge.

Meanwhile, as China pushes for financial reform and gradually loosens control over capital accounts, offshore investment will become even more popular, Xi said.

The People's Bank of China said in a guideline in early December that it will permit businesses and individuals to open offshore accounts in the China (Shanghai) Pilot Free Trade Zone, a significant step toward liberalizing strict controls over capital accounts and easing inflationary pressure on the nation's mounting foreign exchange reserves.

"It could offer great opportunities for us to expand our services, and we are closely following the details," said UBS' Jin.

Often, people with such needs for wealth management already have opened accounts abroad, Leung said.

Thus, parent banking organizations make money from Chinese clients but not necessarily the Chinese branches, he noted.

Some foreign banks are lowering their thresholds for opening private accounts in China as a way to foster more prospective big clients.

Standard Chartered has integrated its private banking department into a wealth management department in China from this year, and lowered the threshold for private banking from $1 million to $500,000.

It makes sense to develop new clients from the emerging new rich, Leung said.

But the core strength of foreign banks is offshore business. Based on the current situation, they can operate it offshore as well, with a coordinated team based in China, he said.