Italy’s biggest bank UniCredit
plans on doubling its presence in China in the next few years to
gain a greater foothold in Asia’s biggest economy by opening up new
branches. And UniCredit also plans on launching new products such
as e-banking and cash management in China.
Currently, UniCredit has 55
employees in China and they plan on doubling their staff through
the expansion.
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Maurizio Brentegani, UniCredit head
of China and general manager of the bank’s Shanghai branch, told
RBI if the bank does not expand, it will be losing out on
a great opportunity.
“We have been observing, for many
of our home market clients, China has been of high strategic
importance, and now they are investing more and more in China,”
Brentegani says.
“Therefore, we
are following in our clients’ footsteps and expanding our presence.
Supporting the growth of European home market companies in China is
obviously a correct strategic choice for UniCredit.
“We are not competing and do not
intend to compete with local Chinese banks.”
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By GlobalDataUniCredit regards China as an
important extension of home markets, and supports the expansion of
European home market companies in China.
The Milan-based lender’s expansion
plan in China is customer-driven.
“Our logic of network expansion is
to be close to our customers, to provide better services,”
Brentegani says.
“We have one branch in Shanghai and
two representative offices in Beijing and Guangzhou, which can
cover our target clients well.
“Upon receiving final commencement
approval from the China Banking Regulatory Commission, our new
Guangzhou Branch is going to be open very soon.”
According to UniCredit, the way the
bank treats its clients is what distinguished it from other
competitors.
“‘Customer Centricity’ is one of
the pillars of UniCredit’s business model and so it will be in
China,” said Brentegani.
“Fortunately, we have established a
strong local professional team, who know our home markets and the
local one well. This team is offering high-quality services to
clients.
“China is the number one priority
of UniCredit in Asia, but we also want to benefit from the strong
growth of other Asian countries.
“We have branches in Hong Kong,
Singapore and Tokyo, and representative offices in Mumbai, Hanoi
and Seoul, which cooperate to support our customers in Asia,” adds
Brentegani.
The only threat to the UniCredit
Asian expansion plan is external. The current crisis in the
eurozone could seriously impact on the business of all European
banks in China.
The number of international banks
in China has grown significantly since 2007 although there has been
a slowdown in the pace of assets growth in the past two years.
As of year end 2010, there were 185
banks from 45 countries with 216 representative offices in
China.
A key challenge for international
banks in China remains liquidity although analysts have highlighted
that this is becoming less of an issue.
According to the consultants KPMG
international banks in China reported average deposits growth of
43% in the period 2009-2010 against sector growth of an average
35%.
Despite the growth in deposits, the
29 international banks which disclose country specific figures for
China reported an average loans-to-deposit ratio of 102% in the
year to 2010.
This was in excess of the 75%
target set by regulator for year end 2011, but a vast improvement
from an average ratio of 150% in 2009.
Meghna Mukerjee
