China approves ABN AMRO, Galaxy joint venture<\/p>\n
Dow Jones, Shenzhen, China<\/p>\n
China has given approval to the Hong Kong unit of ABN AMRO
\nHolding NV to acquire a stake in China's Galaxy Futures Co. from
\nChina Galaxy Securities Co., a senior official from China's top
\nfutures regulator said on Saturday.<\/p>\n
This is the first time China has approved a joint venture
\nfutures brokerage, indicating the Chinese government is gradually
\nallowing foreign companies to invest in local futures markets,
\nalthough indirectly. Galaxy handles futures in metals and
\nagricultural commodities.<\/p>\n
Yang Maijun, director of the Department of Futures Supervision
\nin the China Securities Regulatory Commission, confirmed the
\napproval during a speech at the two-day China International
\nDerivatives Forum, which started on Saturday. Talk of the
\napproval had circulated among traders and analysts for days.<\/p>\n
\"ABN AMRO has already passed CSRC's inspection and review,\"
\nYang said, adding that one of CSRC's major goals is to invite
\nforeign futures brokerages to participate in Chinese markets.<\/p>\n
ABN AMRO's Hong Kong-based unit is widely expected to take a
\n30 percent to 49 percent stake in Galaxy Futures, analysts said
\nbefore the announcement.<\/p>\n
Meanwhile, the CSRC is also preparing to allow Chinese futures
\nbrokerages to invest in overseas markets, Yang said.<\/p>\n
\"After some new regulations are launched next year, we will
\nallow qualified Chinese futures companies to set up branches in
\nHong Kong. We are talking to Hong Kong now and hope there will be
\nsome companies going there next year,\" said Yang.<\/p>\n
Nicholas Ronalds, senior vice president of ABN AMRO, said at
\nthe sidelines of the forum his company has yet to get official
\nnotification from the CSRC.<\/p>\n
But he confirmed preparations for the joint venture have
\nreached a final stage.<\/p>\n
\"We will definitely launch our joint venture within this
\nyear,\" said Ronalds. He declined to say what stake his company
\nplanned to take in the venture.<\/p>\n
Ronalds said he didn't expect ABN AMRO to get any profit from
\nthe joint venture in the next two to three years, and that his
\ncompany is looking at the long term potential in the futures
\nbusiness in China.<\/p>\n
\"We will only invest in the joint venture (in the next two to
\nthree years) instead of getting a return,\" he said.<\/p>",
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