Rising FDI behind CMB's investment-banking foray

As China's economy continues to transition and the country increases its foreign direct investment (FDI) , financial institutions will be asked to provide more investment-banking services, according to executives with China Merchants Bank.

"We are at China Merchants Bank (CMB) will continue to leverage a favorable environment to move forward in investment banking," Ju Zhao, executive vice-president of CMB, told an audience in New York on Oct 9 at the bank's China-US Cross-Border M&A Forum.

CMB is also eager to earn the business of overseas companies that want to establish operations or expand their footprint in China, said Chengyue Jiao, the general manager of CMB's New York branch.

He noted that investment banking is becoming a rising priority for Chinese companies. "As the Chinese economy transitions into its next phase which will involve more foreign investment, Chinese companies will need help and we can provide that, "Jiao said

"Chinese companies have gone from operating in neighboring areas like Hong Kong to more competitive markets like the US and Europe," noted Shanqing Zhou, counselor of the Chinese Consulate General office in New York.

Jiao said Chinese companies now have the confidence to participate in other markets, particularly in the US. He said CMB is not only increasing its offerings in M&A through its cross-border Yunex M&A platform; the bank is also bolstering its asset-management and private-banking operations. "Chinese businesses and individuals will require advice in managing their money especially when they go overseas," he said.

Jiao said sectors in the US that look attractive for Chinese investment include agriculture, energy, healthcare, and manufacturing.

CMB is also ready to provide investment banking services to foreign companies like US-based Nanobeak LLC. According to Chairman and CEO Jeremy Barbera, Nanobeak is utilizing technology developed by NASA to advance breath testing which can reveal the presence of cancer and other diseases earlier than traditional testing procedures.

"About 55 percent of cancer patients die because they found out too late that they have cancer," Barbera said.

Nanobeak, which employs 24 at its New York headquarters and at a laboratory in California, is looking to China Merchants Bank to help the company expand into China.

"We hope to take our company into China next year," said Barbera. "CMB is helping us to raise capital for clinical trials and to set up important relationships for us in China."

Barbera said it was important for Nanobeak to work with a Chinese bank. "They know the area and more importantly they know the strategic players that we need to know in China. It's important to have local representation," he said.

paulwelitzkin@chinadailyusa.com