So far, the bank has opened branches in 25 countries and regions, according to bank President Liu Mingkang.

"The trial operation of the new branch suggests that we have full confidence in the trade and investment potential between China and the Philippines," Liu said. It also suggests that the BOC holds optimistic views on the future development of the Philippines' economy, he said.

With a capital of US$12 million, the Manila branch will mainly engage in renminbi-related business, including deposits, loans, remittance, financing and settlement in its early stage, he said.

Liu noted that Bank of China has already mapped out an ambitious plan to turn itself into a large international bank with competitive advantages and good corporate governance within three to five years.

"The bank will further grow into one of the top international banks through merging and acquisitions within five to 10 years," Liu said.

Bank of China last year successfully reorganized its Hong Kong business by merging 10 branches to register Bank of China (Hong Kong) Co Ltd.

"This is one of the most important things that Bank of China has accomplished to meet the challenges by China's membership in the World Trade Organization (WTO)," Liu said. "Experiences gained from the reorganization will help Bank of China further reform and will help the bank later when it gets listed."

With an aim to establish better corporate governance mechanisms, Bank of China since 2000 has continuously improved its decision-making systems and has enhanced inner-control systems.

Bank of China took a lead in China to compile financial reports in accordance with international accounting standards, which reveal more information including the ratio of bad loans, Liu said. The bank also paid much attention to training and management of human resources.

"Bank of China's reform measures over the past years have achieved remarkable results," Liu said. The bank reported a profit of 10.8 billion yuan (US$1.3 billion) last year.

Profits made by branches on the Chinese mainland rose 4.7 per cent from a year ago to 2.25 billion yuan (US$271 million), while that made by overseas branches dropped 9.85 per cent to 8.56 billion yuan (US$1.03 billion).

(China Daily January 29, 2002)