Standard Chartered Bank to set up China Desk at head office in Sri Lanka due to expanding Sino-Lanka ties
The Standard Chartered Bank (SCB) is in the process of setting up a China Desk in its Head Office in Sri Lanka’s business capital, Colombo to better serve the fast-expanding economic cooperation and business ties between the two countries at public and private sector levels, local media reports state.
“Sri Lanka is a compelling story for and in China’s Belt and Road Initiative (BRI) and we have seen growing engagement by China in Sri Lanka initially with Government-to-Government agreements and investments in key infrastructure. The engagement with the private sector is tipped to grow as well,” Standard Chartered Bank Sri Lanka CEO, Jim McCabe has reportedly told journalists.
“Setting up the China Desk with dedicated professional Chinese banking staff is a further sign of our commitment to support greater partnerships. The potential for expanding Sri Lanka-China ties and the socio-economic benefits are tremendous and exciting,” he has added.
The local media has reported that a seven-member team from the Standard Chartered Bank (China) Ltd., led by its Head of Transactions Banking Sam Xu, visited Sri Lanka last week, meeting officials of Chinese companies engaged in various mega projects in Sri Lanka and who are the clients of the bank.
The special visit by the SCB China team follows a similar exercise in Mumbai and Delhi early last week and concurrently by a separate team visiting Bangladesh and Pakistan.
China’s BRI encompasses Greater China, ASEA, South Asia, the Middle East, Sub-Saharan Africa and the Europe.
The Daily FT has reported that in Sri Lanka some of the BRI-inspired Chinese investments under public-private initiative include the Colombo International Container Terminal in Colombo Port and the Hambantota Port by China Merchant and the Port City and proposed Industrial Zone in Hambantota by China Harbour Engineering Corporation.
SCB has reportedly stated that it has over 150 years of franchise in China with Shanghai as its second branch after opening the first in Calcutta. With around 1,000 branches and outlets in over 60 countries and regions, SCB said 70% of its global footprint was made up of the Belt and Road markets.
This, according to Xu, makes SCB a home bank in these markets as opposed to a foreign bank.
Xu has further noted that last year Standard Chartered Bank’s China transaction banking unit saw BRI-related net incremental new business grow by 30% to US$ 1.2 billion and a similar increase is forecast for 2018.
McCabe and Xu have reportedly said that the Bank’s portfolio of Chinese clients is growing even in Sri Lanka.
They have added that the visit by the team from China is to better understand clients’ needs to better support them in the future in terms of the entire gamut of banking services. These Chinese companies are also SCB’s existing clients in China.
According to McCabe, operational support to these large Chinese projects in Sri Lanka following Government-to-Government agreements had been on the rise along with volume of flow of funds.
Noting that several other banks too were competing for Chinese businesses, McCabe has said given the substantial growth in China’s engagement via the BRI there was scope for banks to collaborate for the benefit of clients.
The decision by Standard Chartered Bank to open up a China Desk in its head office in Colombo stands testament to the strong as well as growing Sino-Lanka ties. Other foreign banks based in Colombo could also follow this precedent to explore the growing trade ties between Sri Lanka and many other foreign countries to promote their banking business as well. Other foreign clients of Standard Chartered Bank could also look at doing business with China through Sri Lanka.
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