Citigroup says it is planning to locally incorporate its Chinese operations as soon as possible in order to comply with new Chinese banking regulations.
The new rules were introduced recently by the Chinese authorities as part of the preparations for the opening of the country’s markets to foreign banks in December. They require local incorporation of foreign banks in order to protect local depositors.
The Citigroup announcement follows similar announcements by HSBC, Standard Chartered and ABN Amro.
China agreed to allow foreign competition in its financial sector as a condition of entry to the World Trade Organization in 2001.
Citigroup took a 20 per cent stake in China’s Guangdong Development Bank earlier this month.