Chapter 293 Bank Cooperation

After staying in Saudi Arabia for a few days, Barron thanked the Walid couple for their hospitality and invited them to give him the opportunity to show their kindness to the landlord the next time they came to England.

Then Barron took Alia and the rest of his entourage on a Gulfstream G450 and took off from Riyadh Airport to China HK.

Although Penguin is about to be listed in Hong Kong, this is not the main reason why Barron came here this time.

The last time he made an acquisition of Standard Chartered Bank, Barron had already been to Hong Kong. At that time, he met with local tycoons including Li Chaoren and bought part of Standard Chartered Bank shares from them.

When he arrived in Hong Kong this time, Barron also received invitations from several wealthy people, and they would hold a cocktail party to welcome him.

After all, in addition to Barron's status as a British aristocrat, he is also at the top of the Forbes rich list, and his assets at this time are higher than those of Hong Kong's richest man, Li Chaoren.

And after acquiring Standard Chartered Bank, his business has become increasingly close to these local families.

But before that, Barron first came to the Standard Chartered Bank Building, the standard headquarters of Standard Chartered Bank HK in Central.

Currently, Standard Chartered Bank is headquartered in London, its Asia-Pacific headquarters is in Lijiapo, and its HK headquarters is mainly responsible for business in Greater China.

Here, Zeng Jingxuan, the CEO of Greater China who just took office, reported some information about China’s business to Barron, who is the chairman of Standard Chartered Bank:

"We are currently negotiating the specific terms of this in-depth cooperation with the Bank of Communications. According to your request, we will show the greatest sincerity while considering our own interests..."

Zeng Jingxuan, 47, has served Standard Chartered Bank for 12 years since joining it in 1992 and has rich financial experience.

The reason why Barron chose her to serve as CEO of Greater China after acquiring Standard Chartered Bank was of course not just because of her eldest brother, but because she did have the corresponding abilities.

"I am very optimistic about the future development of Huaxia. In the past, Huaxia had many restrictions on foreign investment in the financial industry. Now they are commercializing their banks and they need our international experience. This is a good opportunity."

Zeng Jingxuan also agreed very much with what Barron said.

Starting this year, China began to launch the joint-stock restructuring of state-owned commercial banks and promote the establishment of a modern financial enterprise system-this is a very important reform based on Barron's previous experience.

In fact, since the new central bank governor took office last year, he has begun to lead the joint-stock restructuring of state-owned commercial banks and decided to use foreign exchange reserves to inject capital.

To this end, Huijin was established at the end of 2003 and injected US$22.5 billion into China Construction Bank and Bank of China respectively, starting the process of joint-stock restructuring of the four major banks.

In 1999, after the four major banks divested 1.4 trillion in non-performing assets to the four major asset management companies, by the end of 2002, measured according to the five-level classification standard, the non-performing rate of the four major banks was 26.1% - except for China Construction Bank, which had a non-performing rate of 15%. Around 20%, others are above 20%, Agricultural Bank of China's non-performing rate reached 36.6%, more than one-third of the loans are non-performing loans.

At that time, many foreign people believed that Huaxia Banking Industry was already "technically bankrupt."

But Barron knew that after this reform, Huaxia Banking's scale and profitability soon ranked first in the world.

For example, in his previous life in 2018, among the top ten institutions in the world announced by the British "Banker" magazine, the top four were China's four major banks. This was not easy.

Bank of Communications is the fifth largest bank in China, only behind the four major state-owned commercial banks ICBC, ABC, China Construction Bank and China Construction Bank. It currently has 2,700 branches and outlets. For Barron, what is even more tempting is that these branches Most of the institutions are located in China's wealthiest cities.

As early as earlier this year, the news that Bank of Communications was going to introduce strategic investment immediately aroused huge repercussions at home and abroad. They immediately attracted many investment intentions, and the market was booming.

At that time, banks including Citigroup, HSBC, Standard Chartered and other investors took the initiative to visit us to understand the situation and express their sincerity in investing.

After Barron became the majority shareholder of Standard Chartered Bank, he immediately asked them to start negotiations with the Bank of Communications.

Their biggest competitor at that time was HSBC, and Barron also knew that in his previous life, it was HSBC that finally won out among many competitors.

However, Barron, who knew the importance of this cooperation, was naturally unwilling to give up this opportunity to participate in the commercial reform of Hua Xia Bank. Not only did he relax the initial cooperation conditions of Standard Chartered Bank, he also used his many previous contacts in Hua Xia Bank to ——Especially the official channels in Zhejiang Province and Shanghai, where Bank of Communications is headquartered.

Finally, with the approval of the China Banking Regulatory Commission, in early April, Bank of Communications began exclusive negotiations with Standard Chartered Bank, which represented Standard Chartered Bank's temporary victory in this competition.

After Zeng Jingxuan took office as CEO of Standard Chartered Bank Greater China, she was responsible for the negotiation of this cooperation.

"In December last year, the China Banking Regulatory Commission decided to increase the shareholding ratio of a single foreign-funded institution in a state-owned commercial bank from the original 15% to 20%. Before and after the decision was released, the chairman of the China Banking Regulatory Commission also expressed on many different occasions that he welcomed foreign-funded institutions to participate in the shares HSBC Bank……"

Zeng Jingxuan took out the relevant documents and said to Barron:

"According to your opinion, we have been willing to set the shareholding ratio in this cooperation at 19.9% ​​from the beginning, which is close to the shareholding limit of foreign banks. Among all competitors, only we and HSBC are willing to take this shareholding ratio." shareholding ratio, so they were our biggest competitors before.”

As early as 2001, HSBC successfully acquired 8% of the shares of Mordu Bank.

Compared with them, Standard Chartered Bank has lagged behind in cooperation with Hua Xia Bank.

However, in this competition, Standard Chartered Bank and HSBC can be said to be evenly matched.

Standard Chartered Bank is the oldest foreign bank in China - in 1858, Standard Chartered Bank came to Shanghai from England.

For nearly a century and a half, Standard Chartered Bank has never left Shanghai. After the founding of New China, the then Chinese government only retained four foreign banks, HSBC, East Asia, Overseas Chinese and Standard Chartered, to continue operating in Shanghai.

Later, Standard Chartered Bank also became the "designated bank" of the People's Bank of China to operate foreign exchange business, and assisted in opening up the financial situation at the time at the request of the government.

Therefore, this cooperation with Bank of Communications, whether it is Standard Chartered Bank or HSBC, is not surprising. The two can be said to be indistinguishable.

In the end, it was through more relaxed conditions and Barron's own efforts - he is not only the Duke of England, but also a world-renowned rich man, and has made many investments in China before, so his efforts will naturally be taken seriously. .

"Other conditions can be relaxed appropriately, but the clauses to prevent share dilution must be adhered to."

"This has also been agreed by the other party, and they seem to hope that we can maintain a 19.9% ​​shareholding ratio."

Barron was not surprised by what Zeng Jingxuan said.

The main purpose of Bank of Communications' cooperation with foreign investors this time is capital and experience.

Standard Chartered Bank's willingness to invest in shares is relatively high, which is also welcomed by them - in this way, Bank of Communications can obtain more funds, and it will also help Standard Chartered Bank to deeply participate in the management and reform of Bank of Communications, which will help Bank of Communications learn from the other party's advanced management and operation experience. .

At the same time, Standard Chartered Bank is very familiar with the Chinese market and culture, which is conducive to the success of future cooperation.

In addition, Standard Chartered Bank is also willing to provide cooperation solutions in the field of bank cards, which is very practical and urgently needed for Bank of Communications.

It is also because of these factors that it became the basis for the cooperation between Standard Chartered Bank and Bank of Communications.