China's securities watchdog is expected to approve the foreign brokers, Nomura and J.P. Morgan, soon to set up their joint ventures in which each will hold a 51-percent stake, showing China's further opening-up in the financial industry, according to a report of Securities Daily.
China Securities Regulatory Commission (CSRC) issued a document in April 2018 allowing foreign companies to hold majority shares in a joint venture (JV). Since then, several foreign companies have applied to increase shareholding or establish new securities company controlled by the foreign side.
UBS announced recently that the CSRC had approved UBS AG to increase its shareholding in its securities JV in China, UBS Securities Co. Ltd, from 24.99 percent to 51 percent, and UBS became the first foreign bank to have a majority control of a securities JV in China.
On May 8, Nomura submitted an application to the CSRC to establish a securities JV in which it will take a 51-percent stake.
Later, on May 10, the J.P. Morgan also applied for establishment of a securities company in which it will take a 51-percent stake and considered increasing the shareholding to 100 percent in the new JV in a few years when conditions permit.
The two foreign brokers have both received written replies from the CRSC and the applications are expected to be approved soon.
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