Shanghai seeking to be hub for financing

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As Shanghai tries to make itself into an international financial center in 2012, it will give support to Chinese commercial banks that want to set up headquarters here.

That's what Shanghai Mayor Han Zheng said on Wednesday.

In order "to take its economy to a higher level", Shanghai must vigorously push forward with industrial restructuring. He said Shanghai should structure industries in a way that accords with the city's status as an economic hub.

Shanghai's financial markets are expected to handle 1 quadrillion yuan ($160 trillion) in transactions by 2015, according to statistics from Shanghai's financial authority. A recent ranking of global financial centers put Shanghai as the sixth best competitor among financial centers in the world. The year before, it was ranked eighth.

Shen Liqiang, manager of the Shanghai branch of the State-owned Industrial and Commercial Bank of China Ltd, said: "Shanghai is a good place for the financial industry now. But since the 'big four' banks all have their headquarters in Beijing, Shanghai has no advantages in policy support."

Ge Dawei, deputy director of the city's financial service office, said a greater presence of commercial banks will strengthen Shanghai's financial industry.

"It would be better if we could provide more financial products and services in the future as more professionals gather here," he said. "Also, when we compare ourselves with first-class international financial hubs, we see that we should further improve the city's legal and credit system.

"Of course, support from the central government is essential - for example, giving us more independence in examining and approving businesses and in setting interest rates."

Han said the city will work with central financial authorities to improve financial markets as the yuan is being used more frequently in cross-border transactions.

This past year saw the establishment of a group of foreign private-equity firms and third-party payment companies in Shanghai.