The huge market potential of China -- the door to which opened wider on its entry into the World Trade Organization last year -- has prompted the world's leading investment banks to redouble their presence in the world's most populous country.
Among them, New York-based Credit Suisse First Boston (CSFB) has recently strengthened its management team covering the nation, where it sees a swiftly expanding capital market.
"As we look towards 2010, we expect China to be the second largest capital market in the world, with more than US$2 trillion of market capitalization," said CSFB Chief Executive Officer (CEO) John Mack.
"We are fully committed to this market, as is demonstrated by the calibre of the leadership team we have assembled in the region, and we are eager to work with Chinese companies and the government in this exciting period. We have made China our priority in the Asia-Pacific region, and one of the key markets globally."
Mack came to Beijing last week with a group of CSFB senior executives to meet with Chinese Government officials and business leaders.
Earlier this year, CSFB reshuffled its Asia-Pacific team, adding Asia-veteran executive Paul Calello as Asia-Pacific CEO and Wei Sun Christianson, who has extensive experience working with Chinese companies, as China investment banking chief.
"We have been awarded some significant mandates in the region; we are very proud of those," Calello said. "We feel like we are very much in the position to gain more business, and very committed to establishing an even broader and deeper relationship with Chinese."
Noting that China should foster more integrated investment banks to compete with foreign rivals, Mack said the threat of foreign acquisitions is not a near-term worry.
"You will see joint ventures, initially, and then after some period of time, possibly you could see some acquisitions, but I don't see that in the near future," said the investment banker, citing the strengths of local brokerage houses' knowledge of the market and their distribution systems.
He referred his Chinese counterparts to the China International Capital Corporation as an example of "fully-integrated securities houses" that have investment banking expertise, research of companies, a very liquid trading market in both equities and fixed-income, as well as asset management capabilities with mutual funds.
"They are setting the prototype of how Chinese companies need to use resources to compete around the world," he said.
CSFB's global profits dropped last year in an industry-wide setback and is in the process of slashing expenditure. It entered China in the early 1980s.
( April 15, 2002)
