Nanjing City Commercial Bank (NCCB) and BNP Paribas wish to announce that they have today formally entered into a strategic alliance, pursuant to which:
- BNP PARIBAS is to acquire from several shareholders a 19.2% shareholding in NCCB at a price of RMB 704 mn (approximately US$ 87 mn). BNP PARIBAS will therefore become the second largest shareholder in NCCB behind the Nanjing State-owned Asset Investment & Management Holding (group) Co. (unchanged at 19.7%), but before Nanjing New Port High-Tech Co (unchanged at 17%) and IFC (reduced from 15% to 5%);
- BNP PARIBAS and NCCB will establish a close cooperation in certain operational areas, including retail banking, fixed-income transactions, consumer finance, wealth management, risk management, information technology and organisation, with a view to further develop and enhance NCCB's franchise and core competitiveness as well as capture new business opportunities in the fast evolving Chinese banking market.
The NCCB/BNP PARIBAS alliance will be managed by an ad-hoc joint working group. BNP PARIBAS will also second to NCCB a number of executives and experts, including a Vice President who will be a member of NCCB's executive office, for the purpose of implementing the strategic alliance and providing technical assistance and guidance in the areas of governance, risk management and consumer banking. BNP PARIBAS will in addition appoint one of the six members of the board of NCCB representing shareholders.
The NCCB/BNP PARIBAS alliance is subject to regulatory approval and is expected to close before year-end.NCCB
NCCB is located in the capital city of the Jiangsu province in Eastern China, approximately 300 km north-west of Shanghai. NCCB is the 8th largest city commercial bank in China, with total assets of RMB 42.7 bn (US$ 5.3 bn), a loan portfolio of RMB 22.5 bn (US$ 2.8 bn), and RMB 35 bn (US$ 4.3 bn) in deposits (as of end of September 2005). The NCCB network comprises 58 branches in the city of Nanjing and employs nearly 1 500 people. It is active in corporate lending, trade finance, mortgage lending as well as securities dealing. It has benefited from very significant growth during the last few years, with CAGR for total assets of 20%, while maintaining the good quality of its portfolio with Non Performing Loans ratio of 3.4% as of end of September 2005.
NCCB's net banking income for 2004 was RMB 848 mn (US$ 105 mn), up 35% from 2003, and its pre-tax profit for 2004 was RMB 294m (US$ 36 mn), up 80% from 2003. Its pre tax-profit for the first 9 months of 2005 amounts to RMB 340 mn (US$ 42mn)BNP PARIBAS in China
BNP PARIBAS has been present in the People's Republic of China since 1980 and now operates four branches in Beijing, Shanghai, Guangzhou and Tianjin, in addition to its wholly-owed subsidiary BNP Paribas (China) Ltd as well as a sizeable presence in Hong-Kong. BNP Paribas has strong ambitions for its development in mainland China and enjoys prominent positions in corporate banking, export and project finance, global trade services and fixed income activities. Thanks to its full RMB and Derivatives licence and its granting of a Qualified Foreign Institutional Investor status in 2004, BNP Paribas offers to its clients a comprehensive range of products.
In 2003, BNP Paribas was among the first foreign banks to establish two joint ventures, playing its part in China's financial markets reform:
About BNP Paribas Group
- Changjiang BNP Paribas Peregrine Securities, in Investment Banking (leader in the listing in Hong Kong of PRC companies).
- Shenyin & Wanguo BNP Paribas Asset Management Co. Ltd, in Asset Management.
BNP Paribas (www.bnpparibas.com
) is a European leader in banking and financial services, with a significant and growing presence in the United States and leading positions in Asia. BNP Paribas is the first bank in the Euro zone in terms of net income (2004). The group has one of the largest international banking networks, present in over than 85 countries with close to 100 000 employees, including 67,000 in Europe. BNP Paribas enjoys key positions in its three core businesses: Corporate and Investment Banking, Asset management & Services and Retail Banking.