US opens its banking market to China’s biggest bank

‘It has total assets of roughly $2.5 trillion’:

US: The United States on Wednesday opened its banking market to ICBC, China’s biggest bank, and extended the US reach of other major Chinese state-controlled banks, citing improvements in Beijing’s bank supervision.

Industrial and Commercial Bank of China (ICBC), Bank of China and Agricultural Bank of China have been cleared to have branches in the United States, the Federal Reserve said. The Fed board approved an application from ICBC to buy a majority stake in the US subsidiary of Bank of East Asia, a deal that would make it the first Chinese state-controlled bank to acquire retail bank branches in the United States.

The US unit of Bank of East Asia operates 13 branches in New York and California.

Partnering with ICBC in the deal are China’s sovereign wealth investment fund, China Investment Corporation, and the CIC subsidiary Central Huijin Investment.

“The Board has concluded that consummation of the proposal would not have a significantly adverse effect on competition or on the concentration of banking resources in any relevant banking market,” the central bank said.

ICBC has been the most aggressive of China’s “big four” banks in expanding overseas.

The bank has total assets of roughly $2.5 trillion, the Fed said.

In other Fed board decisions, Bank of China, the third largest bank, won approval for a branch in Chicago. Bank of China operates two insured federal branches in New York City and an uninsured branch in Los Angeles. AFP