JPMorgan <JPM.N> is one of several international banks looking to participate in the country's booming but restrictive domestic securities business after Beijing agreed last month to resume licensing joint ventures.
TIANJIN, China (Reuters) - JPMorgan Chase is talking to a number of potential partners about forming a securities joint venture in China, a senior executive said on Friday.
JPMorgan <JPM.N> is one of several international banks looking to participate in the country's booming but restrictive domestic securities business after Beijing agreed last month to resume licensing joint ventures.
"We are very interested in the Chinese securities sector," Joseph Regan, JPMorgan's Asia-Pacific vice-chairman, told reporters. "We've been approached by a few firms."
Regan, speaking on the sidelines of a China-U.S. financial forum in this northern port city, declined to name the suitors. Although some of its rivals had a head start, JPMorgan would be patient in its selection, he said.
!ADVERTISEMENT!"It sounds mundane, but the right partner is someone who aligns with our objectives for the long term. We're taking a 20-year outlook on this, not the next 12 months in league tables," Regan said.
China's domestic initial public offering market nearly tripled last year to $60.7 billion, according to Thomson Financial, and foreign-invested brokerages have been among the top dealmakers.
China International Capital Corp, a joint venture backed by Morgan Stanley <MS.N>, was the biggest underwriter of Chinese domestic A shares last year, Thomson data show.
Joint ventures involving UBS <UBS.N><UBSN.VX> and Goldman Sachs <GS.N> ranked third and seventh, respectively.
Credit Suisse <CSGN.VX> said on Thursday it plans to form a joint venture with the Founder Group, which is backed by Peking University. HSBC <HSBA.L><0005.HK> and Citigroup <C.N> are also in talks with potential partners, industry sources have said.
Morgan Stanley also signed a strategic cooperation agreement late last year with China Fortune Securities, which is controlled by several Shanghai firms.
New rules that went into effect at the start of the year modestly expand the business scope of securities joint ventures but limit foreign firms to one-third ownership.
"I think we'd like to take advantage of the limits, but it depends on the partner and how that all works," Regan said.
Chris Keogh, head of China Securities at Goldman Sachs, said the firm was happy with its three-year-old venture, Goldman Sachs Gaohua Securities, and did not foresee any changes to it.
"I personally am thrilled that there are other foreign houses coming into China," Keogh said, citing the benefits of competition for investors and capital-raising companies alike.
Keogh is senior adviser to Gaohua chairman Fang Fenglei, a renowned investment banker who helped create the venture in late 2004 and is now setting up a pair of mainland venture capital funds.
Keogh avoided a direct answer when asked whether Goldman planned to invest in Feng's yuan-denominated fund. The Wall Street Journal said this week Goldman would put around $300 million into the fund.
(Reporting by Simon Rabinovitch; Editing by Alan Wheatley)
