Chinese securities firm off to business in S. Korea after year-long delay

By Park Sae-jin Posted : May 24, 2018, 10:44 Updated : May 24, 2018, 10:44

[China Merchants Securities]


SEOUL --  China Merchants Securities, a major Chinese securities firm, has officially opened its South Korean business this week, sparking expectations that an inflow of Chinese capital would resume after a year-long hiatus caused by a diplomatic row over a U.S. missile shield.

In an inaugural ceremony in Seoul on Wednesday, China Merchants Securities Korea got off to business in the South Korean capital market, a year after it obtained a brokerage license from financial authorities. "Entering the South Korean market is an important step for us to become a global enterprise," China Merchants Securities CEO Yan Wang said.

China Merchant Securities is a large securities company with its capital estimated at about $10 billion. The opening of its South Korean branch had been delayed due to a diplomatic deadlock over a Terminal High Altitude Area Defense system (THAAD) battery deployed by U.S. troops last year.

"The launch of China Merchants Securities Korea is a timely decision and it is expected to bring new vitality to cooperation in the financial sector of the two countries," Chinese Ambassador to South Korea Qiu Guohong said at the ceremony.

Seoul and Beijing agreed to normalize relations under an agreement in October last year, but Chinese steps have been gradual.

Wednesday's ceremony raised expectations that Chinese capital would flow back into South Korea's financial market. Chinese financial firms can acquire know-how on financial investment business from domestic securities firms, market analysts said, adding Chinese capital may advance into savings banks and credit-specialized companies.

A brokerage house official in Seoul said Chinese capital based in South Korea will be able to expand into third countries. "It is easy for Chinese capital to acquire domestic financial companies, but it is difficult for our capital to buy Chinese financial companies," said Hwang Se-woon, a senior researcher at the Korea Capital Market Institute.

 
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