Banking News
- BOC explores private banking
Date: 21-Mar-2007 Sources: (Xinhua Online)
The Bank of China will begin offering private banking services next Wednesday - becoming the first domestic bank to target China's growing ranks of millionaires.
The Beijing-based bank will provide the elite services first in the capital and in Shanghai, using a specially trained team to serve high-end clients, the country's second-biggest lender said Tuesday.
It will later expand the operation into other cities, according to bank spokesman Wang Zhaowen.
The private banking service, which is targeting customers with more than 1 million U.S. dollars in financial assets, is a joint project with the Royal Bank of Scotland. The two lenders decided to tap the sector in February 2006 and began training staff and seeking locations.
Overseas banks such as BNP Paribas, HSBC and Citigroup Inc have already begun private-banking operations in China.
Banks mainly target business owners and entrepreneurs in the sector to capitalize on the notion that high-end clients represent only 20 percent of a bank's customers but provide 80 percent of its revenue.
The Chinese mainland was home to 320,000 millionaires in 2005, according to a report by Capgemini SA and Merrill Lynch & Co. The total assets held by this group topped 1.59 trillion U.S. dollars at the time, ranking China No. 2 in the Asia-Pacific region following Japan, the report said.
That number is bound to increase rapidly given the country's continuing economic boom, analysts said.
The Royal Bank of Scotland, Britain's second-biggest by market value, owns about 4.4 percent of the Bank of China.
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