Swiss bank UBS will need to rework its expansion plans in China as a result of its imminent takeover of troubled compatriot Credit Suisse and the regulatory complications involved.
Both UBS and Credit Suisse have pursued their own ambitions in China’s capital market in recent years, including the wish to take full control of their respective joint brokerage ventures.
While UBS holds 67% of Beijing-based UBS Securities, Credit Suisse has a 51% stake in Credit Suisse Securities China.
But according to current rules under the China Securities Regulatory Commission (CSRC), no overseas bank is allowed to own a majority share in more than one capital markets venture.
UBS’s application to set up a wholly-owned mutual fund venture in China may also be complicated by Credit Suisse’s 20% share in a joint venture with Industrial and Commercial Bank of China – ICBC Credit Suisse Asset Management – plus the joint venture that UBS already has with China’s State Development and Investment Corporation.
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