By Rose Yu
SHANGHAI--Bank of Communications Co. (3328.HK), China's
fifth-largest bank by assets, said Wednesday it has received
approval from Taiwan's financial regulator to open a branch in
Taipei.
Bank of Communications, also known as BoCom and in which HSBC
Holdings PLC (HBC) owns a 19% stake, said its Taipei branch has a
registered capital of 1.475 billion new Taiwan dollars(US$49
million) and the deal marks the biggest investment by a mainland
Chinese company in Taiwan so far.
"The establishment of the Taipei branch is an important step by
the bank to expand its global footprint," said the state-run
Chinese bank.
It said the Taipei branch will be mainly engaged in taking
deposits, lending, remittance and trade finance.
Since Beijing and Taipei signed the Economic Cooperation
Agreement Framework in June 2010, major Chinese banks have
established representative offices in Taipei as thawing
cross-Strait relations have opened up opportunities in trade
finance.
Taiwan's Financial Supervisory Commission, the financial
regulator, said in December that Bank of China Ltd., the
third-largest bank by assets on the mainland, and BoCom were given
approval to upgrade their representative offices to branches after
a year of operation on the island.
The FSC has gradually loosened restrictions on Chinese banks
investing in Taiwan. Since Jan. 2, the regulator has permitted
Chinese banks to buy stakes in Taiwan banks. There have been no
deals to date, but some Taiwanese banks--including state-run Mega
Financial Holding Co. and Cathay Financial Holding Co.--have
expressed interest in selling stakes to Chinese counterparts hoping
closer ties will speed up their own expansion in China.
Write to Rose Yu at rose.yu@dowjones.com