The strong economy and a growing middle class, together with the continued opening up of the banking sector under the terms of China’s WTO accession, has led many foreign banks to continue to invest in China’s financial sector, says PricewaterhouseCoopers in a recent report entitled “Foreign banks in China 2007″.

The report is based on the second PricewaterhouseCoopers survey on foreign banks in China, following the inaugural survey published in September 2005. This survey focuses on the strategic and emerging issues surrounding foreign banks’ expanding activities in China. It attempts to synthesise diverse viewpoints and offer insights into this fast changing financial services environment, based on interviews with CEOs and senior executives and branch managers of 40 foreign banks.

The key objectives of the survey are to:

• Raise awareness of strategic and emerging issues for foreign banks in China;
• Establish data on certain industry trends;
• Understand the thinking of Chief Executive Officers in the banking industry;
• Provoke discussion and debate on the best options for capitalising on trends to enhance and improve Performance of foreign banks;
• Provide insights and perspectives on how banking in China may evolve over the next three years.

According to the China Banking Regulatory Commission(CBRC), at the end of 2006, 74 foreign banks from 22 different countries and regions had established 200 branches and 79 subbranches in 25 Chinese cities. A further 242 representative offices have been established. The growth in foreign bank participants also demonstrates the continued commitment of the Chinese government to bank reform and the role that foreign banks can play in improving the competitiveness of the overall Chinese banking sector.

Findings of particular interest in the survey include observations on the changes in China’s financial market, the development of the regulatory environment, banking risks in China, future opportunities and the results of the peer review.

Download the report at PricewaterhouseCoopers

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