- Joint venture plans to offer services in Qianhai next year
- Boost comes after earlier setback of executive going missing
Credit Suisse Group AG’s joint venture in China won approval to offer securities brokerage services for the first time, in the economic zone of Qianhai in the southern city of Shenzhen.
The venture may start offering the services early next year after the approval by the China Securities Regulatory Commission, Credit Suisse said in a statement Thursday. Set up in 2008 and controlled by local partner Founder Securities Co., the business was previously restricted to capital market services such as underwriting stock and bond offerings.
The boost to Credit Suisse Founder Securities Ltd. comes after the earlier setback of the venture’s former Chairman Lei Jie -- also the former chairman of Founder Securities -- going missing in January. He was later released from police custody, a person familiar with the matter said this week. Lei said on Tuesday that he was no longer involved with the joint venture and wouldn’t comment further.
Goldman Sachs Group Inc. and UBS Group AG, the foreign firms with the longest-established securities joint ventures in China, already offer brokerage services across the country through their local partners. Those firms got their licences before a moratorium on new joint ventures was imposed in 2006.
Credit Suisse was the first global brokerage to win a license after the nation re-opened the securities industry to foreign participation in 2008. Bank of America Corp. is the only major Wall Street firm without a license.
HSBC Holdings Plc said this month that it would form a majority-controlled securities venture in Qianhai, benefiting from an economic partnership agreement between Hong Kong and the mainland that allows Hong Kong-funded institutions to set up joint venture firms in Shanghai, Guangdong province and Shenzhen. The venture has not received approval yet.