China's Bank of Communications Financial Leasing Co Tuesday said it plans to launch a subsidiary specializing in aircraft and ship leasing in Shanghai's free trade zone by the end of this year, a move seen to spearhead the company's overseas development.

The leasing firm, a wholly-owned subsidiary of the Bank of Communications, China's fifth-largest bank by assets, became the first non-banking financial institution to get a green light to set up a subsidiary in the zone on September 29, when the zone was officially opened.

"The establishment of a specialized subsidiary in the zone offers us a long-awaited possibility to develop both domestic and overseas markets simultaneously," said Chen Min, chairman of BoCom Financial Leasing.

The proposed leasing unit will lease aircraft and ships in foreign markets to tap tax benefits and relaxed restrictions over airplane purchase, order delivery and fundraising.

Chen said the proposed subsidiary will help the company participate in the global market directly and take advantage of advanced asset management skills from global peers.

Li Ling, general manager of the company's aviation leasing division, said the new subsidiary may lure more foreign airlines. Its existing lessees include Korean Air and KLM.

Chen said the proposed subsidiary in the zone will take over most of BoCom Financial Leasing's aircraft and ship leasing business.