China Construction Bank (CCB), the mainland's top property lender, said yesterday it plans to aggressively expand its network in Hong Kong over the next three years to compete with foreign banks.

 

The mainland's third-largest bank, which bought Bank of America Corp's Hong Kong and Macao operations for US$1.24 billion last year and renamed it China Construction Bank (Asia) yesterday, said it will open 14 more branches in the next three years in addition to the existing branch network.

 

"Leveraging on the solid foundation and financial strength of our new parent company, China Construction Bank (Asia) is ready to embark on a series of business expansions," said Samuel Tsien, chief executive officer of CCB (Asia).

 

CCB (Asia) now has 14 branch networks in Hong Kong and three in Macao.

 

CCB also plans to expand in other parts of Asia, and may make other purchases to facilitate its expansion.

 

"We do not rule out the possibility of further mergers and acquisitions to carry out our expansion plan," said Fan Yifei, vice-president of CCB.

 

Fan said CCB will eventually "go back to the mainland market" by listing on the A-share market or taking a China Depository Receipt (CDR).

 

"A CDR would be preferable since its price would trade more closely to its H-share counterpart, but it all depends on the situation and our shareholders' wishes," said Fan.

 

CCB's top management declined to give specific Asian expansion plans but said the bank planned to invest HK$200 million (US$25.6 million) to add 14 branches.

 

"Opening each bank branch will cost about HK$10 million to HK$15 million, depending on the branch size and location," said Tsien.

 

Along with the network expansion, Tsien said the bank would add 300 new staff to increase the size of its workforce to more than 1,000.

 

(China Daily January 11, 2007)