Foreign stakes 'to increase'

China agreed to let foreign banks raise their stake in domestic securities firms to as much as 49 percent in a move that may strengthen the nation's capital markets, a US official said.

China also plans to let foreign investors establish joint ventures to trade commodity and financial futures, the official said on Friday, speaking to reporters on condition of anonymity as the nations conduct talks in Beijing. Foreign banks' ownership in securities firms is currently capped at 33 percent.

Morgan Stanley and JPMorgan Chase & Co are among the US banks that may gain more control over underwriting operations in China, the second-biggest market for share sales in 2011 after the United States, according to data compiled by Bloomberg. Goldman Sachs Group Inc and UBS AG are the only foreign firms to currently have management control over their local ventures.

Agencies - China Daily