Standard Chartered:Supporting Chinese Enterprises

2018-11-26 18:26:24 China Pictorial2018年11期

by Hu Zhoumeng

Since Standard Chartered Bank set up its first Chinese branch in Shanghai in 1858, it has witnessed the great economic development in contemporary China. Especially since 1978, the countrys reform and opening up has provided huge opportunities for the development of the bank. Standard Chartered has one of the largest foreign bank networks in China. In 2007, Standard Chartered Bank (China) Limited became one of the first batch of foreign-funded local corporate banks. Over the past decade, Standard Chartered has opened 100 outlets across 30 Chinese cities, employing more than 6,000 people.

As China opened its door to the outside world, Standard Chartered Bank began actively supporting cross-border trade and investment by helping Chinese enterprises reach out and overseas enterprises enter. Recently, Zhu Yaming, vice president and managing director of the Personal Finance Department of Standard Chartered Bank (China) Limited, was interviewed by China Pictorial (CP). She said that Standard Chartered Bank will focus on advantageous fields in line with the future trajectory of Chinas economy including the Belt and Road Initiative, the internationalization of RMB, the opening up of financial markets, the development of small and medium-sized enterprises (SMEs), and the continuous expansion of the middle-income group.

CP: In 2018, in response to the national policy of further opening up in the financial sector, China relaxed restrictions on the establishment of foreign- funded financial institutions, expanded their business scopes and rolled out measures to widen market access for foreign companies. What does Standard Chartered Bank think of these new policies?

Zhu: Standard Chartered Bank welcomes the introduction and implementation of policies on deepening the countrys opening up and relaxing market access in the financial sector. These proactive measures will expand foreign financial institutions business operations in China and accelerate the reform of Chinese banks. We have been greatly encouraged by these measures along with other foreign banks. Further expansion of the financial sector not only reflects Chinas opening up at a higher level, but also promotes deeper integration of international and domestic markets.

Thanks to those opening-up policies, Chinas financial industry has witnessed great changes, one of which is the introduction of various innovative financial products and services. Standard Chartered Bank has offered featured financial services including trade financing, structured finance, international trade settlement, foreign exchange and derivatives, cash management and wealth management to meet the needs of the Chinese market.

CP: Since the Belt and Road Initiative was introduced five years ago, more and more Chinese enterprises have begun to explore overseas markets and dock with overseas partners. How will Standard Chartered Bank help these enterprises?

Zhu: Standard Chartered Bank has long considered the Belt and Road Initiative the focus of its strategy. Nearly 70 percent of Standard Chartered Banks global branches are in countries and regions involved in the Belt and Road Initiative. In most of those countries and regions, we have operated for more than 100 years and have a profound understanding of local policies, economies and cultural environments. In 2017, we participated in 50 projects, more than half of which were in Africa and another quarter in South Asia.

Over the past five years, Standard Chartered has been providing innovative and high-quality financial products and services for Chinese enterprises participating in the projects. Standard Chartered has also established close partnerships with Chinas policy banks, commercial banks, import and export credit insurance institutions, multilateral financial institutions and online financial services institutions, and carried out substantive cooperation with them.

CP: What difficulties are faced by SMEs in financing? How does Standard Chartered Bank help solve these problems?

Zhu: Standard Chartered China set up a special SME unit in 2003 and has been cultivating SME business in China for 15 years. Many SMEs have difficulties securing loans because they cannot provide suitable collateral. For such light assets enterprises, we will comprehensively inspect the business model of the enterprises, the development of the industry, existing contract orders, abilities of leaders and other things. We solve the financing problems of these enterprises through the comprehensive rating of enterprise credit and providing non-mortgage loans for SMEs.

CP: What risks are faced by Chinese enterprises in international trade? How does Standard Chartered Bank help these businesses reduce risks?

Zhu: The services we provide for import businesses can be summarized in four aspects: shortterm trade financing, cross-border financing, foreign exchange risk management, and regional risk management.

First, foreign suppliers normally require importers to pay deposits or prepay for goods. Capital demand can be met by financing products. International banks can help companies utilize capital from home and abroad, reduce financing costs and expand financing channels.

Second, international banks can facilitate seamless transactions for buyers and suppliers in international trade, avoiding delays or errors between the two parties in otherwise cross-bank payments, which can cause companies to lose business opportunities.

Third, trading companies are impacted by exchange rate fluctuations, but experienced international banks can provide comprehensive foreign exchange solutions including money exchange and transfer, forward exchange transactions and foreign exchange swaps that can help companies control exchange rate risk.

Fourth, it is difficult for domestic companies to assess overseas risk when importing goods from a foreign land. They are subjected to unforeseen market changes and may fail to secure stable sources of procurement. With the help of banks with global networks, companies can gain more market insights and valuable suggestions.

CP: RMB has become the worlds third-largest trade financing currency and the sixth largest payment currency. Its function as a trade, payment and financing currency is increasing. How is Standard Chartered Bank adapting to this new trend?

Zhu: Standard Chartered Bank is at the forefront in the field of RMB internationalization. We have 11 foreign currency direct trading market qualifications, and we are one of the first banks to be granted direct access to Chinas Cross-border Interbank Payment System. We are also the first international bank to provide RMB clearing services and one of the largest RMB clearing institutions in China. Standard Chartered Bank operates a strong network of onshore and offshore RMB services in more than 36 countries and regions.

CP: What will Standard Chartered Bank display at the China International Import Expo (CIIE)?

Zhu: Standard Chartered Bank is one of the first enterprises to pledge to participate in the CIIE. Our booth at the expo will focus on three main themes: trade, the Belt and Road Initiative, and the 160th anniversary of its operation in China. Standard Chartered Bank will release a customized trade financing plan for import companies during the expo. One thing deeply rooted in Standard Chartered Banks DNA is supporting cross-border trade. Currently, we have rich experience and resources in providing shortterm trade financing and foreign exchange management, and we are glad to support exhibitors and buyers at the expo with our services.