China Merchants Bank (CMB), the country's sixth-largest lender by assets, plans to open at least five new private banking business centers this year in addition to its current eight branches, said Monday's China Daily.

This will give CMB a presence in nearly all advanced regions across the country. The bank was one of the first Chinese lenders to foray into the high-end wealth management sector by offering comprehensive banking and financial planning services to individual customers who have assets of at least 10 million yuan.

Other Chinese lenders plan to follow suit. Bank of Communications, which has opened five private banking branches in major Chinese cities including Beijing and Shanghai, announced it will expand into more provinces and cities this year with outlets in Jiangsu, Henan, Hubei, Shanxi and Qingdao.

The Agricultural Bank of China and Shanghai Pudong Development Bank are also considering entry into the new market in the near future.

Industry insiders said the ongoing financial crisis offers a window of opportunity for Chinese banks to develop their private banking business in the next two years, as investor enthusiasm fades for overseas high-yield, but risky, investment products.

The newspaper said behind the rush to the private banking sector by Chinese banks is the rapid accumulation of wealth by some Chinese individuals.

According to a report jointly released by CMB and Bain Consulting, the number of people with assets above 10 million yuan suitable for investment in China reached 300,000 by the end of 2008, who together have 8.8 trillion yuan, equal to 29 percent of the country's total GDP last year.

(Xinhua News Agency June 22, 2009)