China International Capital Corp, CICC, intends to create offices in Indonesia and Malaysia as part of its aims to increase its footprint in Southeast Asia, as local deal activity has been slow.
Established in 1995, the Beijing-based investment bank is presently present in seven global financial hubs beyond China’s borders, such as Hong Kong, New York, London, and Singapore.
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In June, the state-owned CICC expanded its footprint in Southeast Asia, which is home to many rapidly expanding economies, by opening a representative office in Vietnam.
Reported by Reuters, growing geopolitical tensions and a weakening Chinese economy have severely impacted dealmaking activity in Hong Kong and the mainland, particularly at China’s oldest and largest investment bank, CICC.
In its key markets of China and Hong Kong, CICC has reduced banker pay and is considering reducing employment levels. The investment bank’s profit and stock price have also fallen significantly.
Other Chinese investment banks have been equally impacted, prompting a rush by Chinese and Wall Street banks to pursue commercial prospects in other Asia Pacific markets.
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By GlobalDataDue to the region’s growing economy, youthful, highly skilled populace, and expanding infrastructure, Southeast Asia has become a worldwide investment hotspot in recent years.
CICC, whose strategic owners include top Chinese technology companies Tencent and Alibaba, sees huge potential in private funding for Southeast Asian unicorns and startups.
Other potential includes an increase in cross-border investments from Chinese enterprises, particularly in Southeast Asia’s consumer, technology, media, telecom, fintech, logistics, and electric vehicle sectors.
In addition to this, Chinese banks maintain their dominance in the global largest lender rankings of 2023.
This is despite a downturn in the property sector, according to the Global Bank Ranking published by S&P Global Market Intelligence, an annual ranking of the 100 largest banks in the world by total assets.
Chinese banks retain 20 positions in the ranking, including the top four. This showcases the continued strength of China’s banking sector. Industrial and Commercial Bank of China remains the world’s largest bank, with assets of $6.3trn. Agricultural Bank of China surpasses China Construction Bank to claim second place, with 14.5% loan growth in 2023.
