Citigroup, which earlier announced its decision to dissolve its investment-banking joint venture in China, is now setting up a wholly-owned securities business in the world’s second-largest economy.
The New York-based bank may initially focus on brokerage and futures trading while expanding its custodian services in China, quoting sources familiar with the matter. This comes as China announced the removal of ownership caps for financial institutions.
The people asked not to be identified because a final decision has yet to be made. It also plans to apply for a futures license as early as the first half of 2020.
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Earlier this year, Citigroup has agreed to sell its stake in its Citi Orient Securities joint venture to its Chinese partner, as it prepares to set up its own brokerage in the world’s second-largest capital market.
In December, Citigroup Global Markets Asia informed Orient Securities that the bank intended to sell all of its shareholdings, the Chinese company said in an exchange filing. Orient said its board gave the green light for the acquisition of Citi’s stake, adding that the deal will be subject to approval from China’s securities regulator and state asset regulator.