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CITIC, Credit Agricole To Create China, Asia-Pacific Focused Investment Bank

CITIC Securities, a China-based institutional broker and investment bank, and Credit Agricole Corporate & Investment Bank (CA-CIB) have signed a memorandum of understanding (MOU) to explore the combination of their respective positions in global equity brokerage and investment banking businesses.

Areas covered by the business combination include global equity, cash as well as client driven derivatives, and investment banking businesses in China and Asia Pacific region, offering financial advisory and equity market (ECM) services.

Moreover, the two firms aim for their business combination in the Asia-Pacific region to provide a foundation for the build out of a unique global equity business platform aligned with CA-CIB’s brokerage, ECM and client driven equity derivatives businesses.

The business combination aims to create a global equity brokerage with independent research (with over 350 analysts worldwide), distribution and execution capabilities championed through CITIC Securities, CLSA and Cheuvreux and CA Securities; build an investment banking platform with a focus in China and Asia-Pacific, with CITIC Securities becoming CLSA’s JV partner in China on institutional brokerage and investment banking and further develop the ECM franchise in Europe and in the US and build cross-border synergies.

Dongming Wang, chairman of CITIC Securities, said: “The formation of the strategic partnership with CA-CIB, a leading investment banking partner, marks another significant step of CITIC Securities towards internationalization.

“Riding on our roots and strengths in China, our goal is to reinforce our already strong capabilities in servicing international companies seeking to tap Asian capital markets, as well as Chinese entrepreneurs, corporations, and state-owned enterprises looking to access capital or to pursue investment opportunities outside of the region.

“CITIC Securities will continue to strengthen and develop our retail brokerage business, asset management, and investment business which are currently focused on China and Hong Kong, adding an international edge to these business arms.”

Jean-Paul Chifflet, CEO of Credit Agricole and chairman of CA-CIB, said: “CITIC Securities, a leading brokerage and investment bank in China, is the best possible partner to create with CA-CIB a truly global equity platform spanning Europe, Asia, and the US. This partnership, client driven, is an additional opportunity to consolidate the Credit Agricole group’s presence in China, where it operates since 1898, and more generally in Asia, a high growth region.”

Patrick Valroff, CEO of Credit Agricole CIB, said: “We are excited to explore such a partnership, which would bring together an unmatched pool of entrepreneurial talents and combine our equity product offering globally to create a successful player with a unique positioning in the market place.”

Boming Cheng, president of CITIC Securities, said: “At CITIC Securities, we are eager to extend our equity market services, offering our clients with enhanced, distribution network, financing, research and advisory capabilities beyond China.”

However, the transaction is subject to corporate and regulatory approvals, as well as consultation or consents of relevant third parties.