China’s leading banks have handed in applications to manage mutual funds, a business expected to boost slumping markets, the China Securities Journal reported Wednesday.

The Industrial and Commercial Bank of China (ICBC), the country’s biggest lender, was leading domestic banks in applying for the blossoming business, which regulators had so far approved only “in principle,” the paper said.

Shenzhen-based China Merchants Bank, the biggest of the country’s five listed lenders, is also interested in the business.

However, the country’s four largest State-owned banks — the ICBC, Bank of China, China Construction Bank, and the Agricultural Bank of China — were expected to win the first mutual fund licenses, analysts said.

An approval will mark the return of banks to the stock markets after regulators banned the practice in the mid-1990s amid speculative bubble.

Regulators have yet to mention any timetable to change the current rule that separates the operations of banks, insurers and securities houses. However, domestic banks have been stepping up their efforts in the promising market as they are striving to improve their competitiveness before foreign giants enter the country’s personal savings sector by 2007.

Application procedures and supervision principles were clarified during a recent bank conference in Beijing, the paper said.

(Shenzhen Daily October 21, 2004)