Shanghai Pudong Development Bank is offering up to three billion yuan in credit line over the next three years to Shanghai-based Eastern Airlines.

This is the third package of credit support provided for the company in two months.

China's two largest banks, the Industrial and Commercial Bank of China (ICBC), and Bank of China, also offered credit lines of 17.6 billion yuan and 12 billion yuan respectively to the airline.

Experts in the banking community explained that companies like the airline are high-end clients which banks are competing for.

"High-end" refers to companies or individuals whose business or personal financing involves huge sums of money. They usually have strong solvency and good credit.

The experts said 80 percent of the profits of Chinese banks comes from high-end clients, about 10 percent of their customers, compared with 20 percent in the international banking industry.

A Chinese bank employee said a big client may be more attractive than 100 ordinary ones.

Mobile phone producer Ericsson shocked the Chinese banking sector by repaying its immature loans in advance to a Chinese bank, and striking a partnership deal with an overseas bank.

Newspaper commentators described the Ericsson case as the first where overseas banks compete with Chinese counterparts for high-end clients.

China has promised to open up its financial service sector step by step, and a growing number of overseas banks are expected to be licensed in coming years to launch financial services.

Wang Zhile, an expert on multinationals, said several state-owned banks began to solicit multinationals a few years ago, especially from the world's top 500 companies.

The Shanghai Branch of the ICBC recently launched special services for key clients, and the Shanghai Branch of the Bank of Communications last month introduced personalized financing services to individuals with considerable financial assets.

Insiders say all those moves aim to win over clients they value most through better services.

(China Daily May 27, 2002)