On May 31, HSBC's new branch opened to business at Huaihai Road in Shanghai, announced HSBC. This makes HSBC the only foreign-funded bank to have two branches in Shanghai. Citibank, which is also experiencing aggressive expansion in the Chinese mainland market, will debut its CitiGold, a wealth management banking service, in the Chinese mainland very soon in a few days.

As learned the two banks are very prudential about enlarging their operation networks in the mainland market and both set up special strategic inspection teams before the moves. In fact, foreign-funded banks generally focus more on high returns and low risks than larger market share.

As Dicky Yip, HSBC's executive for China business, said: "HSBC is looking for more right places. But it takes time to do all of this." Citibank sold its building mortgage project in Hong Kong to Bank of China (Hong Kong) a year ago due the low returns on investment for this business.

Michael Smith, CEO of HSBC, released in an interview with International Financial News that his bank, which already invested 1 billion USD in the Chinese mainland, would explore more potential by enlarging its network. He did not confirm the speculation in town that HSBC would put stakes in the Communication Bank of China. Instead, he stressed: "HSBC's strategic needs are fully taken into consideration before any expansion. On the other hand, expansion also depends on the opening procedure and legal framework of Chinese market."

By People's Daily Online