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RBS' international expansion plans in emerging countries – a joint venture in China
The Royal Bank of Scotland (RBS) is the first UK bank and the seventh bank internationally to get approval to enter the investment banking business in China. RBS is poised to unveil a financial securities joint venture in China, to capitalise on thriving markets in the engine of Asia’s booming economy. A BBC report states that sources reveal the bank is in detailed talks with Chinese group Guolian Securities, and that the announcement of a deal could come very shortly.?? Such a joint venture would build on minority stakes that RBS already has with two Chinese financial companies, Galaxy Futures and Suzhou Trust. The tie-up with China’s Guolian Securities will allow RBS to manage share sales and issue debt in China’s fast-growing financial markets.
In 2010, initial public offerings in China amounted to around two thirds of the world’s total. RBS’ vision is to bring British, European and US companies to China, and allow Chinese investors to gain access to foreign companies, equities and debt. Foreign companies are not currently allowed to list shares in China but that is expected to change in the near future. Morgan Stanley, UBS, Deutsche Bank, CLSA Asia Pacific, Credit Suisse and Goldman Sachs have also received approval to set up securities ventures in China. A tie-up with a Chinese partner is a pre-requisite for a foreign bank wanting to enter the securities business.
RBS will have a 33% stake in the venture, which will be known as “Hua Ying Securities”. Hua means “Chinese”, while Ying means “British”. RBS wishes to be a top bank in China, and the joint venture will be based in Wuxi, Jiangsu Province, about two hours away from Shanghai. RBS has thus far declined to disclose how much the bank had invested in the venture.
RBS, 83% owned by the taxpayer after being bailed out by public money at the height of the financial crisis, has in fact been seeking a new Chinese securities joint venture for some time. The government has said it will ultimately sell its stake in RBS, but is unlikely to do so until the Independent Commission on Banking, due in September, reports its findings.
RBS is seeking to shore up its business in China, after it was forced to sell a stake in Bank Of China in 2009 for 1.6bn pounds. China is a core market for RBS in Asia as well as globally. RBS had intended to continue to invest significant resources in building their wholesale and investment banking businesses there.?? Therefore, in addition to their existing joint venture interests in Galaxy Futures and Suzhou Trust, they have also seeking a securities joint venture.”
RBS’s formidable move comes as many major international banks are focusing on China’s market in securities – tradeable financial assets such as equities and bonds – for growth.?? Analysts have said this drive had been sharpened in the wake of economic fragility in Europe and the United States. UBS, Credit Suisse, Goldman Sachs, Morgan Stanley and Deutsche Bank are among global banks with securities joint ventures in China. RBS has sold 311 RBS branches in England and Wales, and seven NatWest branches in Scotland, to Santander of Spain, while also disposing of assets such as Linea Directa in Spain, Sempra Metals, the oil and European energy business venture, and GMS, its payment processing business that includes the WorldPay brand. RBS has thus far quit retail branch banking in several overseas territories where it lacked major scale such as Taiwan, Hong Kong and Indonesia.
A successful joint venture will allow RBS to take part in that country’s thriving domestic capital markets, such as issuing debt and equities, underwriting bonds, etc. The rationale is clear. Recent data this month showed that Chinese industrial output exceeded forecasts, highlighting that the country’s economy had remained buoyant despite government efforts to clamp down on bank lending and property speculation.?? RBS has also signaled that it wishes to withdraw from retail banking in many overseas locations but in many cases it wishes to add to investment banking operations where profitable overseas.
Have the Chinese lost face over the Morrissey “subspecies” comment?
A guest article by Sonny Leong, Publisher and Chair, Chinese for Labour
In an interview in the Guardian Weekend magazine recently, Morrissey, gormer singer of The Smiths, describes Chinese people as a “subspecies” because of their treatment of animals. The response of the British Chinese community was deafening silence.
Morrissey reignites racism row by calling Chinese a ‘subspecies’. Remark came in context of an attack on China’s animal welfare record, with singer having been criticised on a number of previous occasions for negative race comments The link is here.
Can you imagine the fuss if Morrissey had made such comments about Indians, Africans, or Jews? There would be uproar, marches down Parliament and demonstrations across the land. So where are the Chinese protests or demonstrations? Nowhere. Absolutely zilch! Have we lost our face over this comment?
Why do the Chinese complain so little? Where are the Chinese business and community leaders defending their values and pride? Why is no one from the community standing up to the authorities to insist that this
sort of behaviour is totally unacceptable?
Anna Chen, performer, writer, and broadcaster who blogs as “Madam Miaow” ( www.madammiaow.blogspot.com), and is often the sole British Chinese commentator to protest against not only Morrissey’s
statement, but also the intensifying prejudice emerging in the liberal media, says:
“There’s been a wave of anti-Chinese Yellow Peril fever whipped up coinciding with the rise of China as a superpower, surfacing in sensationalist scapegoating every time there’s a disaster. They’ve attempted to stick us with the Foot and Mouth Disease outbreak in rural England, the Gulf Of Mexico BP oil leak, even climate change when the West has been belching out carbon emissions for 160 years since the industrial
revolution and look set to continue doing so at four times per capita that of the Chinese. She has been criticised by the mainstream media in her fight against racism in the media.
”
Here is what she says of the BBC’s celebration of Fu Manchu:
““Fu Manchu in Edinburgh” gleefully revived racist stereotypes of the Chinese I’d hoped were long-buried, and could have been subtitled, Racism for Fun. Why present a Yellow Peril figure as if he was a real person complete with lurid wallowing in the very worst racism, dehumanising the Chinese as a race, linking us with filth, and presenting us as Bin Laden-like Western-civilisation-hating subhumans? There was no irony. No attempt to subject these prejudices and stereotypes of a bygone era to any kind of modern interrogation. Instead, they were re-imported, intact, into the present day. I can’t imagine the BBC vilifying any other minority
group like this.”
The author Sax Rohmer had never met a Chinese person and was writing from malice and ignorance — the “experts” on this programme only have one of those excuses.
There’s a woeful absence of Chinese voices in the media, so when the BBC fills the vacuum with degrading Sinophobic depictions such as this one, they do a grave disservice to a significant licence-paying section of the population.
Professor Greg Benton of Cardiff University also commented: Chinese are quite numerous in British society today, but ethnic Chinese are very underrepresented in the BBC and its programmes, which is a disgrace. This was not a very funny programme, and if it was meant to be ironic, the irony didn’t work. If you’re a young Chinese isolated in an overwhelmingly white school and community, as many if not most young Chinese are, you get a lot of mockery along these lines. Why not commission more work on that? First deal with the racist stereotyping – then we can perhaps afford to be ironic about it.
The British Chinese number more than 450,000, the largest such community in Europe, and the third largest ethnic community in the UK. Yet no senior community leader has stood up to condemn such vile vitriol from a has-been musician in search of a headline.
What would it take for the Chinese community to rise up and challenge such racist statements? What would it take to make the Chinese angry enough to take to the streets to protest? Or are we, such a passive community that we will take whatever is thrown at us so that we can live ‘peacefully’ in our host country?
I say to my community and my fellow community leaders – enough is enough – if we do not stand up for ourselves no one will. We have let down our previous generations who had survived in racist environments and we will let down our younger generation and children for not having the principles and courage to stand up to such cowards.
We portray ourselves as hardworking, law-abiding and successful. We hide behind these norms for fear of misunderstanding. Peel the layers and selfishness, cynicism, exploitation oozes from the community pores.
When criticisms are made, accusations of betrayal and disloyalty are thrown at the maker. No wonder, nobody speaks up. If the community does not feel that it has a rightful place in society then that right will be taken away from them by people like Morrissey. It has been suggested that all the Chinese care about is making money. Yes, make your money but remember there are higher values, too. You have your self esteem, principles, culture and, most importantly, pride. No amount of money is worth it if we let our pride and values slip – we will a forgotten community.
