After months of evaluation by the Swiss authorities, the China Construction Bank (CCB) has received a banking license. The financial market regulator Finma confirmed the information by finews.ch.
The news will come as relief for the Swiss financial market: a Chinese bank will be allowed to start operating in Switzerland for the first time in years. Finma in the past days awarded the China Construction Bank a license to open a branch in Switzerland. CCB applied for the license in March, as finews.ch reported.
The bank will have to undertake some preparatory work before being able to enter its brand in the commercial register of Switzerland and before it can start operating, a Finma spokesman told finews.ch. The regulator wasn't to be drawn on how long this might take.
Preparatory Work Necessary
The preparatory work is however likely to take until the end of the year, people familiar with the negotiations told finews.ch. Where the branch will open in Zurich was speculated about in the Swiss media for some time.
Swiss banking has achieved two mile stones with the award of the license to CCB. The opening of a branch by a Chinese bank is one of the conditions for a trading hub for the renminbi, the Chinese currency, which Switzerland has tried to land for years.
Facilitating Business
Transactions in the Chinese currency, which until today isn't freely convertible, would become possible through the CCB branch. This will make business for Swiss companies with Chinese counterparts easier.
Only a few days ago, finews.ch reported that the People's Bank of China, the country's central bank, was considering the direct trade between renminbi and Swiss franc.
