Industrial & Commercial Bank of China Ltd., China's largest lender, is venturing into the broker-dealer business in the U.S., one of the most telling new signs of the rise of Chinese financial institutions in the world economy.
The Wall Street Journalreported Sunday that ICBC paid $1 to take over the Prime Dealer Services unit of Fortis Securities, controlled by France's BNP Paribas SA. The Fortis operation is small, with just 75 existing customers, but ICBC hopes to use it as a base to potentially expand its underwriting of securities in the U.S. market, according to the paper.
The Beijing-based bank is the world's largest by market value and 70% owned by the Chinese government. The bank has grown increasingly comfortable venturing outside its home markets. The Journal notes the acquisition of the Fortis unit also allows ICBC to avoid tight U.S. regulatory restrictions on foreign purchases of deposit-taking institutions.
