By Sun Fang
It is the key link in the cross-border investment that enterprises adapt to the investment market, find appropriate cooperative partners and open their accounts rapidly either for the“going out” of China-invested enterprises or for the“bringing in” of foreign-funded enterprises. In the context of globally deepening economic cooperation, banks are playing an increasing weighty role in the two-way investment promotion through expanding their international business. In recent years, Bank of Shanghai has developed strategic cooperation with Spanish Banco Santander, set up the international business platform, and taken a lead in the“clients’ landing” by the wind of Shanghai’s development of foreign economic cooperation. It has provided the non-financial one-stop service covering registration, attracting investment, law, financial counseling, etc. After that, it helped the clients land finally with the best financial solution.
Build up 1+1>2 international business platform with overseas help
In 2014, Banco Santander became the strategic shareholder of Bank of Shanghai. Its advantageous branches in worldwide, especially the strong local financial service ability in Europe and Latin America, extremely extended the cross-border service radius of Bank of Shanghai. Whereas, the deep plough of the Bank of Shanghai in Chinese market also provided a convincing service guarantee for it to undertake large customers to land in China. By the end of 2014, the international business platform peculiar to the two banks was born. The platform connected with more than 10 countries and cooperated with professional associations. Up till now, nearly 800 enterprises have achieved the cross-border landing and opened accounts with the help of the platform, which enabled the enterprises to develop and grow up.
“Our bank’s ability to serve the international clients has improved quite a lot through this mode.” Chen Lei, vice general manager of overseas business department and Hong Kong and Taiwan business department in Bank of Shanghai, said that in April last year, the Aluminum Corporation of China Limited planned to acquire a copper mine in Peru, and it was Bank of Shanghai joining hands with Banco Santander that defeated the competitor and helped the client successfully land with the efficient services and high-quality solutions with low cost.“In order to help the client land quickly and successfully, except for the package of solutions provided by the bank, beyond the border we organized the direct conversations and contacts between the Brazil subsidiary company of Banco Santander and the head of the Peru subsidiary company of Aluminum Corporation of China Limited. The inaugural head of Banco Santander in Shanghai flew to Madrid especially for the loan audit meeting to help the client solve the problem of settling in order to avoid the time delay caused by cultural differences.”
Another foreign-funded enterprise entering Chinese market also got help from all aspects through the international business platform. The Spanish royal wedding dress enterprise, the global customer of Banco Santander, needed not only the financial solutions but the exchange of domestic online and offline resources and legal services when it planned to get into Chinese market.“We gave them a detailed explanation on Chinese market environment, supervision requirements and some legal texts, and helped them open the accounts at last. After that, we provided financial management services for the enterprise via the third-party company.” Zhang Wen, head of international business platform of overseas business department in Bank of Shanghai, introduced. It is known that currently the enterprise operates in a good condition in Chinese market.
“International business platform provides customized and high-quality all-round financial and non-financial services for domestic and foreign investment enterprises. We believe that‘1+1>2’ effect has formed,” Chen Lei said.
More personalized financial service from traditional business to innovational business
The enterprises, either for“going out” or for“bringing in”, are in great financial demand. Shanghai is a prosperous market with abundant financial elements, and also the highland of enterprises’ cross-border financial services. Recently, an increasing number of China-invested enterprises have carried out merger and acquisition overseas, leading to an active demand in the cross-border capital accounts. Different from the traditional international business, not only the normal exchange, settlement and financing demands are required, but the comprehensive services including policy consultation, regulatory communication, legal service, project design needed for the cross-border capital accounts.
“The cross-border financial service needs at this stage are not restricted to traditional services. What the enterprises need more are the innovative service and personalized service,” Chen Lei introduced that a company which was set up in Hong Kong with the approval of China Securities Regulatory Commission wanted to acquire a company which was listed on NASDAQ. Traditionally, the long process of bank approval, purchase and payment cannot meet the time constraints of overseas acquisition. Informed of the clients’ needs, Bank of Shanghai has completed the plan design, approval process and fund remittance and transfer in just 20 days, successfully assisted the company’s acquisition and won a high degree of identification of the client by providing the financial products including the U. S. dollar M&A loans of the cross-border direct loan, fund custodian service, fund administration service, fund raise service, free trade zone cross-border investment policy consultation service and overseas direct investment business (ODI), etc.
It is reported that Bank of Shanghai has successfully put more than 120 financial service programs related to the“Belt and Road Initiative” into effect, relevant fields such as clean energy, hydraulic engineering, farming and animal husbandry, electric power equipment manufacturing and medical treatment and health involved and financial services such as bank guarantee, cross-border mergers and acquisitions, cross-border bank consortium and cross-border direct loan addressed.
Strengthening Investment Services of Enterprises’ Supply Chain and Developing with Clients
Although Bank of Shanghai was steadily cooperating with the third parties such as large insurance companies, large lawyer agencies and large accounting firms, providing a series of supporting consultation service covering law, strategy and tax revenue for enterprises“going out”, however, the financial needs of enterprises were in a rapid change.“We serve a core enterprise, but great changes will take place in the financial needs of core enterprises when the upstream and downstream change as the upstream and downstream are separated in the core enterprises,” Chen Lei said.
Nowadays, a growing number of enterprises are going out, and the number is expected to keep growing in the future especially with the evolving of the“Belt and Road Initiative”. Likewise, the needs of the“bringing in” enterprises will also increase with the continuous introduction of the country’s relevant policies and the further opening to foreign investments. Facing the rapid growth of demands for enterprises’ financial services and the quick change of financial demands, the banking sectors are also making preparations for the new system scheme.
“We need to serve the clients with more technological and intelligent means. Bank of Shanghai is building the financial platform for the supply chain, and in the future it will serve the upstream and downstream enterprises when serving core enterprises. In this way, the bank can provide services for the upstream and downstream of enterprises within the production cycle and life cycle of enterprises,” Chen Lei said.
Chen Lei mentioned that supply chain finance is not only a financing service, except for which, increasing operational efficiency of supply chain, upgrading the overall competitiveness of supply chain, and constructing and prospering ecosystem are all the important missions in supply chain finance. Banks provide package of service solutions covering a variety of products such as settlement, financing, accounts receivable management and risk aversion for the entire chain centered on core enterprises. On the one hand, effective capital injection into the upstream and downstream small and medium sized enterprises can satisfy financing demand; on the other hand, the cycle of capital flow in the supply chain of enterprise can be achieved and every member enterprise’s needs can be addressed by including bank credit into the purchase and marketing activities of the upstream and downstream enterprises which enables capital to get into the whole chain from one node of the supply chain. Banks explored the value of supply chain for clients, embedded their products and service into each link of supply chain, and provided solutions to the supply chain financing that is favorable to their clients. Through which, banks achieved the organic integration of supply chain management and financial transaction.
“It’s a huge project and will be built up progressively in the next 2-3 years. Our service will be improved with customer development,” Chen Lei said.
（Investment Promotion）
