Ｃｒｅｄｉｔ Ｓｕｉｓｓｅ Ｅｎｊｏｙｓ Ｃｈｉｎｅｓｅ Ｂａｎｋｉｎｇ

Widening Opportunities forForeign Market Participants

As a result of a direct interaction withits partners and clients in China extend-ing over 5 decades， Credit Suisse alreadyenjoys a very strong position in thecountry's financial markets. The bankmoreover feels generally positive aboutthe significant additional opportunitiesthat have become available to foreignbanking institutions as a result of China'saccession to WTO and the substantial re-forms implemented in that context， statedDr. Urs Buchmann， Managing Director，Country Head China， Credit Suisse.

Growing Demand for MoreSophisticated Financial Services

The ongoing metamorphosis ofChina's economy among others markedby the emergence of an increasinglyvirulent strata of entrepreneurs and pro-fessionals offers attractive additional op-portunities to both domestic and foreigninstitutions in China. In this regardBuchmann cited the example of the rap-idly expanding demand for corporatefinance facilities but also wealth man-agement services and life insurancecover. The latter typically illustrate thegrowing needs of China's middle classfor more sophisticated financialservices. Owing to dedicated manage-ment as well as implementing best-in-class standards and services some newlyformed PRC banks and life insurers aswell as a number of foreign market en-trants have succeeded in effectively ca-tering to such needs. As a result theyhave gained significant market sharewith related profit attributions.

Strong Dependence on LendingActivities by the Domestic BankingSector

Developments have been less dy-namic in China's domestic bankingscene. This situation partly relates to therelatively limited scope of activitiesavailable to Chinese banks under thecurrent segregated regulatory system.Accordingly China's banks still exten-sively rely on lending income with off-balance sheet business requiring furtherdevelopment. Given a rapidly expand-ing demand for more sophisticated fi-nancial services Chinese banks increas-ingly offer retail banking as well aswealth management services. Moreoverthey also have begun to cross-sell prod-ucts in the insurance areas. As a result themost dynamic institutions have succeededin significantly reducing their risk profilewhile expanding capital returns

Risk Management in Focus

Dr. Hans-Ulrich Doerig， the Vice-Chairman of the Board of Credit Suisseregularly recommends that banks furtherdevelop their risk management and self-regulatory capabilities. In doing so henotably refers to the dangers of exces-sive mortgage financing and consumerlending. Such dangers have among oth-ers been experienced in massive securi-ties and housing lendings， e.g. during thestock market rally in Japan in the1980ies or the real estate boom in theUSA and Europe in the 1990ies.

Benefits of Long-term Interaction

Given ongoing quantitative andqualitative growth of China's economyin conjunction with focused financialreform， Buchmann perceives attractiveopportunities for foreign financial insti-tutions in China ranging from commer-cial to investment banking as well asfrom wealth management to lifeinsurance. In response to the favorableconditions enjoyed， Credit Suisse willcontinue to develop its franchise inChina's financial markets and tostrengthen the extensive co-operationbuilt with a wide range of partners eversince the bank entered into direct bank-ing ties with institutions in the PRC inthe mid 1950ies. Credit Suisse Enjoys Chinese Banking——An exclusive Interview with Dr. Urs Buchmann， ManagingDirector， Country Head China， Credit Suisse

By Sun Yongjian

Widening Opportunities forForeign Market Participants

As a result of a direct interaction withits partners and clients in China extend-ing over 5 decades， Credit Suisse alreadyenjoys a very strong position in thecountry's financial markets. The bankmoreover feels generally positive aboutthe significant additional opportunitiesthat have become available to foreignbanking institutions as a result of China'saccession to WTO and the substantial re-forms implemented in that context， statedDr. Urs Buchmann， Managing Director，Country Head China， Credit Suisse.

Growing Demand for MoreSophisticated Financial Services

The ongoing metamorphosis ofChina's economy among others markedby the emergence of an increasinglyvirulent strata of entrepreneurs and pro-fessionals offers attractive additional op-portunities to both domestic and foreigninstitutions in China. In this regardBuchmann cited the example of the rap-idly expanding demand for corporatefinance facilities but also wealth man-agement services and life insurancecover. The latter typically illustrate thegrowing needs of China's middle classfor more sophisticated financialservices. Owing to dedicated manage-ment as well as implementing best-in-class standards and services some newlyformed PRC banks and life insurers aswell as a number of foreign market en-trants have succeeded in effectively ca-tering to such needs. As a result theyhave gained significant market sharewith related profit attributions.

Strong Dependence on LendingActivities by the Domestic BankingSector

Developments have been less dy-namic in China's domestic bankingscene. This situation partly relates to therelatively limited scope of activitiesavailable to Chinese banks under thecurrent segregated regulatory system.Accordingly China's banks still exten-sively rely on lending income with off-balance sheet business requiring furtherdevelopment. Given a rapidly expand-ing demand for more sophisticated fi-nancial services Chinese banks increas-ingly offer retail banking as well aswealth management services. Moreoverthey also have begun to cross-sell prod-ucts in the insurance areas. As a result themost dynamic institutions have succeededin significantly reducing their risk profilewhile expanding capital returns

Risk Management in Focus

Dr. Hans-Ulrich Doerig， the Vice-Chairman of the Board of Credit Suisseregularly recommends that banks furtherdevelop their risk management and self-regulatory capabilities. In doing so henotably refers to the dangers of exces-sive mortgage financing and consumerlending. Such dangers have among oth-ers been experienced in massive securi-ties and housing lendings， e.g. during thestock market rally in Japan in the1980ies or the real estate boom in theUSA and Europe in the 1990ies.

Benefits of Long-term Interaction

Given ongoing quantitative andqualitative growth of China's economyin conjunction with focused financialreform， Buchmann perceives attractiveopportunities for foreign financial insti-tutions in China ranging from commer-cial to investment banking as well asfrom wealth management to lifeinsurance. In response to the favorableconditions enjoyed， Credit Suisse willcontinue to develop its franchise inChina's financial markets and tostrengthen the extensive co-operationbuilt with a wide range of partners eversince the bank entered into direct bank-ing ties with institutions in the PRC inthe mid 1950ies.