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April 6, 2022

HSBC raises stake in Chinese securities venture

HSBC has increased its ownership stake in the Chinese securities joint venture (JV) to 90% as it looks to strengthen its presence in China and the broader Asia region, reported Bloomberg News.

The British lender, which previously owned 51% of HSBC Qianhai Securities, bought the additional stake from its partner Qianhai Financial.

Financial terms of the deal were not disclosed.

Qianhai Financial will retain a 10% interest in the JV following the transaction.

Shenzhen-headquartered HSBC Qianhai Securities specialises in investment banking and securities businesses. It has offices in Beijing and Shanghai.

HSBC secured Chinese regulatory approval for the JV in 2017, becoming the first overseas player to own a majority holding in a Chinese brokerage.

HSBC Asia-Pacific co-CEO David Liao said: “China has one of the most significant capital markets in the world, supporting economic growth and investment opportunities.

“Our increasing stake in HSBC Qianhai Securities reflects our commitment in developing China’s rapidly growing capital markets, and bolsters our presence in a key market.”

HSBC has been accelerating its investment in China after the country lifted its restrictions on foreign-majority ownership in some financial businesses in 2019.

Last year, the bank set up a fintech subsidiary in Shanghai to scale up its business in mainland China, becoming the first foreign financial institution in the country to own a subsidiary.

In 2020, it secured a regulatory nod in China to obtain full ownership of its insurance JV.

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