The world’s second largest bank, China Construction Bank, has opened a branch on Collins Street in Melbourne’s CBD, following in the footstep of its large Chinese rivals, signalling increased interest from Chinese financial institutions in Australia.
The Melbourne branch will focus on wholesale banking business, trade finance and private wealth management. The bank already has a Sydney branch.
‘‘The opening of the Melbourne office is a significant step in the overseas expansion strategy of the China Construction Bank,’’ said Zhang Furong, the executive vice president of the bank, ‘‘ it will strengthen the business capability of our Sydney branch and extends our operation nationally.’’
The bank has a loan book of $119 million, as of June of this year, according to the Australian Prudential Regulatory Authority data. It is a small compared to its more established competitors such as Bank of China, which has more than $6 billion worth of loans on its book.
Apart from establishing a beachhead in the wholesale banking market, the Chinese lender is also keen to grab a slice of the lucrative market of private wealth management.
‘‘CCB Melbourne Branch will be actively promoting our financial and consultancy services to high net worth clients,’’ according to a statement from the bank.
There has been an influx of cashed-up Chinese migrants settling in Australia and the number is expected to increase significantly after the introduction of a special category of ‘‘significant investor’’ visa, which targets affluent Asian investors. Chinese banks are expanding in Australia just as European lenders are scaling back their exposure to Australia due to the eurozone debt crisis.
A recent market review by real estate consultancy CBRE found that the Europeans' departure had left a financing gap that was being filled by Asian banks led by Chinese financiers.
CCB is the second largest bank in China and the world with more than $2.1 trillion worth of assets and it first