Ocean Bank, which aims to become the first ever private bank in Fuzhou city, has filed an application of establishment to the provincial government, Fuzhou Daily reported on Aug 28, citing a source inside the municipal Financial Office.

The bank has been jointly set up by 10-plus private enterprises. Fujian Eversun Holdings Co is the initiator and has taken a share of 10-20 percent, the newspaper said.

China allowed the private sector to engage in banking business last year as part of its deepening financial reforms. The announcement triggered fervent responses from many private enterprises.

In July, the China Banking Regulatory Commission (CBRC) approved applications by three private banks, which were the first three of their kind in the country.

Fujian supports the setting up of private banks, and has facilitating applications by four of them at CBRC, according to an official with the Fuzhou Financial Office.

The wave of private bank applications is good news for Fuzhou, which boasts abundant private enterprises and capital, said Pan Changfeng, an economic professor with the Minjiang University.

“Private banks will boost competition in the financial market, propel interest rate liberalization in Fuzhou, expand financing channels for small and medium-sized enterprises, and make breakthroughs in differentiated financial services,” said Pan.

“For private banks to have a finger in the pie, they will have to take advantage of flexible mechanisms, find development orientation and get creative. They must also pay attention to risk control and credit guarantees.”