UBS has secured approval from the China Securities Regulatory Commission (CSRC) to raise its stake in UBS Securities, its Chinese securities joint venture (JV), to 51%.
In this regard, UBS will acquire stakes of 12.01% and 14% in the JV from China Guodian Capital and COFCO, respectively.
After completion of the transaction, the Swiss investment banking company will become the first foreign bank to raise its stake to get majority control of a Chinese securities JV.
UBS claims to be the first foreign bank to apply for an increase its shareholding in a China venture after CSRC modified its policy in April 2018 to enable foreign firms to take up to 51% ownership in securities companies in China.
Established in 2006, UBS Securities offers individuals, corporate, institutional clients, and qualified foreign institutional investors (QFII) with various financial products and services based on proper risk management.
UBS Asia Pacific president Kathy Shih said: “This is a key milestone and an important part of our China strategy. Our close ties with UBS Securities, our investment banking arm in China, allow us to strengthen our collaboration with our operations across the region which is key to offering holistic solutions to our clients.”
The Swiss firm’s partners in the securities JV, following the transaction, will be Beijing Guoxiang Property Management (33%), Guangdong Provincial Communication Group (14.01%) and China Guodian Capital (1.99%).
UBS Group CEO Sergio Ermotti said: “Growing our China business is key element of our strategy. The further opening up of China’s financial sector represents great opportunities for our wealth management, investment bank and asset management businesses.
“Since establishing our onshore presence in 1989, we have been at the forefront of foreign investment in China. This step underlines our long-term commitment to this market and we will continue to pursue opportunities.”
In another development, the Swiss investment banking firm said it is set to reopen its headquarters and branch in Zurich following a renovation and refurbishment project.
Located at Bahnhofstrasse 45, the UBS headquarters was originally built in 1917 and is one of the 280 branches or so of the banking company in Switzerland.