The announcement earlier this year that Agricultural Bank of China (ABC) has opened a representative office in Sydney means all of China’s big four state-owned banks – the other three are Bank of China (BOC), China Construction Bank (CCB), and Industrial and Commercial Bank of China (ICBC) – have now set up shop in Australia.
In addition, Bank of Communications (BoCom) and People’s Bank of China (PBC), the Chinese central bank, have Australian representative offices.
Chinese firms are continuing to recruit in Australia, which suggests they have yet to reach full capacity, says Morgan McKinley managing director Richie Holliday.
“Whether it’s ICBC or the BOC, they’ve been pulling talent from overseas organisations. If they are setting up in Australia and are being aggressive about it, it will be something that the big four domestic Australia banks will be keeping a close eye on in order to remain competitive and retain their best talent,” he adds.
BOC alone has seven branches across the country including in Melbourne, Sydney, Brisbane, and Perth. Under Australian regulations, foreign firms with representative offices in Australia – in this case ABC, BoCom, CCB and PBC – can only facilitate banking business with their parents overseas.
On the other hand, because ICBC and BOC are set up as branches of foreign banks, they are allowed to carry out retail banking, although only BOC currently provides this service in Australia in order to support the local Chinese population.
Holliday says recruitment demand has focussed on sales and product specialists, fund managers and i-banking roles as Chinese banks seek to tap into new revenue streams – including advising Australian corporations planning to enter China through acquisitions.
Hugh Harley, financial services leader for PricewaterhouseCoopers, says it is not surprising that so many Chinese banks have set up in Australia, given that China has been Australia’s largest two-way trade partner since last year.
However, he believes Chinese banks will remain discreet Down Under for the near future. “We are expecting them to adopt a pretty cautious and low key approach. Their standard operating mode is typically to establish a physical footprint offshore, and use that to build relationships and to understand the local market. Overall, they are expected to adopt a ‘softly-softly’ approach,” he says.
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