China's ICBC targets wealthy Asian migrants

THE world's largest bank, the Industrial and Commercial Bank of China, has opened a new branch in Victoria, seeking to expand its footprint in Australia.

THE world's largest bank, the Industrial and Commercial Bank of China, has opened a new branch in Victoria, seeking to expand its footprint in Australia.

The Melbourne office is the ICBC's third branch in the country after Sydney and Perth. It will focus on developing new business outside of the resource sector, attracting new Australian and Chinese corporate and private clients.

"[The] Melbourne branch will be mainly focusing on sectors including agriculture, property & infrastructure, healthcare as well as renewable energy and natural resources," said Lili Wang, an executive director of ICBC's global board and senior executive vice president, who was in Australia to open the branch.

Apart from serving corporate clients, the bank also wants a slice of the lucrative market of private wealth management, tapping into an influx of cashed-up Asian investors and migrants settling in Australia.

"We are looking to partner with local wealth management firms and expect to become one of the main participants in this sector," Ms Wang said.

George Boubouras, head of investment strategy and consulting at UBS, said there was a clear trend of wealthy Chinese looking to invest money abroad. "Canada, the US, Hong Kong, Singapore and Australia are natural recipients of migration of that level and that would continue," Mr Boubouras said.

The government has recently introduced a special category of significant investor visa to attract affluent migrants. Under the scheme, investors need to invest at least $5 million in government bonds, managed funds or unlisted private companies to qualify for permanent residency in Australia.

ICBC, the world's largest bank in terms of profitability, market capitalisation and customer deposits, opened its Sydney office in 2008 and a Perth branch in 2011, catering for a large number of Chinese mining companies investing in Western Australia.

The WA operation was part of its strategy of developing it into a "resource bank", said Ms Wang. "Perth branch has developed into ICBC's resource-related business platform in Australia."

The Sydney branch has enjoyed strong growth since 2008 and holds more than $4 billion in assets and recorded a pre-tax profit of $49 million this year.

ICBC's Australian corporate clients include blue-chip companies such as Westfield and Qantas and it has provided capital for Victoria's desalination plant, the Royal Adelaide Hospital renovation, and coal terminals in NSW and Queensland.

ICBC is one of the most aggressive Chinese banks in expanding overseas, both through organic growth and acquiring strategic stakes in foreign banks.

BusinessDay understands there is an intense competition for clients and experienced bilingual bankers in Australia between Chinese banks.

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