BIZCHINA / Weekly Roundup
Banks tailor service to super rich
By Zhang Fengming (China Daily)
Updated: 2007-04-09 16:15
Private banking is emerging in China's nascent market as domestic banks
follow the path set by overseas rivals, banking on the country's growing
millionaires.
Bank of China forayed into the super high-end sector by opening an office
offering services in Shanghai. It drew lots of attention as the first
domestic bank to tap the business.
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Bank of China starts exclusive service
The country's biggest foreign exchange lender will offer tailor-made
financial services including tax and property planning to people whose
financial assets are more than US$1 million.
Private banking not only means sophisticated investment products, but
also includes tax planning and even overseas education planning for the
children of the super rich.
The bank followed the route set by overseas rivals such as Citigroup,
HSBC, AIG Private Bank and BNP Paribas.
"Overseas investors are investing for growth potential though the bank
can only offer limited products under the private banking scheme," said
Peter A. Horowitz, senior vice president of BearingPoint, a management &
technology consulting firm.
Available information on the workings of the private banking services in
Shanghai is limited as banks are very low-key on the development of the
sector because of client confidentiality.
Citigroup opened its first private-banking office on the Chinese mainland
in Shanghai in March last year.
Citigroup has signed deals with clients under its private-banking sector.
However, the bank declined to offer more details such as client figures.
Citigroup set a threshold of a net worth of US$10 million or other
currency equivalent, currently the highest level for private banking
services in Shanghai.
Todd Thomson, chairman and chief executive officer of Citigroup Global
Wealth Management, said the private banking office in Shanghai is "an
investment for the future."
The Chinese mainland has 320,000 US dollar millionaires, according to a
report by Capgemini SA and Merrill Lynch & Co.
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