SYDNEY/BEIJING, May 15: Australia and New Zealand Banking Group said on Tuesday it would invest $300 million ($300 million) more to support growth in its China subsidiary as it seeks to boost its presence in Asia.
The additional investment is the first since an initial investment of A$395 million in 2010, the bank said in a statement.
ANZ Chief Executive Officer Mike Smith said in Beijing the bank is on the verge of getting the green light to provide retail banking services in China, adding it also aims to offer wealth management services.
‘Wealth management and individual wealth products are definitely things we will look at in future,’ Smith said.
China has about 85 trillion yuan ($13.5 trillion) worth of deposits, so deposit taking is a lucrative business for banks, especially since banks’ net interest margins are to a large extent protected by strict government regulation.
But China’s tight control over its financial sector means local banks dominate the industry, with foreign banks accounting for just 2 percent of total banking assets in 2010, a survey by accounting firm KPMG showed.
ANZ’s latest investment comes as it tries to model itself after HSBC by turning into an Asian lender. It is seeking to earn 25 to 30 percent of its profit from Asia by 2017.
ANZ owns six outlets, in Beijing, Shanghai, Chongqing and Guangzhou, and it plans to increase its network to 20 outlets in the next 5 to 10 years. Smith said the bank is looking at starting new outlets in the eastern city of Hangzhou.
‘The economic growth in China is still better than anywhere else in the world,’ Smith said.
ANZ owns a 20 percent stake in both Shanghai Rural Commercial Bank and Bank of Tianjin. ($1 = 1.0020 Australian dollars) ($1 = 6.3215 Chinese yuan) (agencies)
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