Chinese lenders Bank of Hangzhou, Bank of Ningbo and Huishang Bank have secured the regulatory approval to open wealth management subsidiaries, reported Caixin.
The approval from the China Banking and Insurance Regulatory Commission (CBIRC) makes these banks the first batch of city commercial lenders to launch such units.
In this work, banks will get six months for preparations that will be reviewed by the watchdog prior to approving licences.
In receiving the clearance, these banks join other big domestic rivals.
Other banks who obtained the go-ahead for the same are China Everbright Bank, Industrial and Commercial Bank of China, Bank of Communications, Agricultural Bank of China, Construction Bank of China, Postal Saving Bank of China, China Merchants Bank, Industrial Bank, and Bank of China.
Overall, 31 banks have revealed plans to establish wealth subsidiaries as per Ernst & Young data.
The move is the result of a revamp in China’s wealth management sector.
As part of this change, CBIRC allowed China wealth management subsidiaries of domestic commercial banks to buy shares.
The country also opened its securities market to foreign competition, with UBS becoming the first foreign bank to take a controlling stake in a China business.
Credit Suisse too followed in the footsteps of UBS, and reached an agreement for raising its stake in its China securities joint venture.