(1888PressRelease)
October 05, 2007 - US financial firms' ambitions in China could be stymied by government moves to prevent them taking over domestic brokerages, it has been reported.
New rules will prevent foreign-owned companies from acquiring more than a 20 per cent stake in Chinese brokerages, according to unnamed sources cited by the International Herald Tribune.
The legislation would severely hamper Wall Street banks' attempts to target the world's fastest growing stock market, where existing regulations already forbid them from setting up their own brokerages.
Tim Ferdinand, vice chairman of Euro Securities, the Chinese investment banking venture of CLSA, said that the proposals indicated that approval for UBS and Goldman Sachs to acquire stakes in Chinese brokerages should be regarded as exceptions.
He added: "Foreign investment banks will have to accept that the Chinese are not going to open their financial markets quickly."
News of the proposed reforms comes as recent figures showed that the size of China's stock markets has grown three-fold this year, to stand at around $3.37 trillion.
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