Hu Pingxi, governor of the Shanghai branch of the People's Bank of China (PBOC), said the competition, in fact, spurred the boom of the financial market in the city.

China has pledged, consistent with its obligations as a new member of the WTO, to give foreign institutions the same treatment as Chinese banks by the year 2007. Permitting the entry of foreign competition was the country's first step in this direction since its WTO accession.

The thriving foreign currency business in this bustling metropolis is shared by both Chinese and foreign banks. More than 330 domestic bank branches were allowed access to this business last year.

While 22 banks from overseas were approved in 2002 to do comprehensive foreign currency business, eight officially launched such services for Chinese customers.

The potential personal financial market is also a hot item. Following Citibank, Hong Kong and Shanghai Banking Corp. (HSBC), and Standard Chartered established personal financial management centers in Shanghai, trying to win high-end customers.

The Chinese banks entered the race by adding more services. The Shanghai Branch of the Industrial and Commercial Bank of China initiated personal service in 1997, and now has nearly 200 offices across the city which offer the service.

While domestic banks win business through their network of thousands of branches, their foreign counterparts rely on on-line and telephone services.

Approved by the PBOC, Citibank has said that it would immediately launch complete Internet banking services for both domestic and foreign clients in China.

HSBC Holding, PLC's Hongkong & Shanghai Banking Corp., Hang Seng Bank Ltd. and the Bank of East Asia Ltd. recently launched their own Internet banking services in China.

Credit card business is another field of competition. Statistics show that at the end of 2002, Shanghai residents held an average of 2.74 banking cards.

A number of Chinese banks have established their credit card centers in Shanghai, and foreign banks, including Citibank, HSBC and Standard Chartered have expressed their interest in this business to the PBOC.

Shanghai municipality, consistent with its ambition to become one of the world's leading financial centers, has urged a number of international banks set up corporate headquarters in the city. A number of Chinese banks also set up their data processing centers and capital clearance centers in Shanghai.

Hu Pingxi has predicted that the 2003 financial sector will maintain last year's rapid, sustainable growth.

(Xinhua News Agency February 20, 2003)