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Bank of China (BoC) will be setting up its first branch in Pakistan as it has received its banking license from the State Bank of Pakistan (SBP).
Finance Minister Ishaq Dar met with Bank of China Chairman Tian Guo Li in Beijing, where the latter was invited to visit Pakistan to inaugurate bank's first branch in Pakistan, expected to be set up in Karachi.
The bank is expected to commence its business after meeting regulatory requirements, and is expected to start its operations in branch mode, said a statement released by SBP.
The SBP statement added that BoC is a subsidiary of China Central Huijin, an investment arm of the Chinese government.
BoC operates on mainland China and has footprints in more than 50 countries across the globe, with 19 of those countries located across China's 'One Belt One Road' initiative.
Explore: IMF warns of looming CPEC bill
At the end of 2015, the bank had a total of 11,633 institutions including 644 in countries outside China.
BoC is the fourth and fifth largest global bank in terms of Tier-1 capital and total assets respectively. It is listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange.
The bank will initially bring $50 million to fulfill the minimum capital requirements of SBP.
The long term objective of Bank of China is to increase its market penetration by opening branches in major cities of Pakistan while aiming to be one of the largest foreign banks in the country.
The bank aims to provide differential and specialised banking services to effectively serve financing needs of the China-Pakistan Economic Corridor (CPEC) related projects by leveraging on its experience and global technology platforms.
Explore: Financing burden of CPEC
The bank is the second Chinese bank entering the Pakistani market.
Read more
On DawnNews
Comments (55) Closed
May 13, 2017 07:15pm
As an Indian, I am happy to see development in Pakistan. This will eventually result in more economic cooperation between India and Pakistan. However, I wonder whether Pakistan is getting over dependent on china. Wish Pakistanis good luck and prosperity
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May 13, 2017 07:17pm
@Thanks - Thanks!
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May 13, 2017 07:30pm
@Thanks It would have been much much better if India and Pakistan could start a project like CPEC jointly. Not even now is too late if India joins CPEC it will not only insure stability if Pakistan but will also lift whole south asia poverty. I see huge potential in India.
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May 13, 2017 07:30pm
@Thanks Thanks for your wishes. As for as dependency on China is concern, its mutual dependence I.e they need trade route and we need investment. Out of over 50bn dollars in CPEC, 34bn dollars is investment, remaining is soft loans of interest rate around 2%.
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May 13, 2017 07:32pm
Welcome to the land of the pure, soil of the brave but a country run by highly corrupt and absolutely nepotism oriented "movers and shakers" in Islamabad.
My message to the Chinese bank and its administration at this crucial juncture in time and history is to keep it up and hang on tough. May God Almighty (if you believe in HIM) bless you.
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May 13, 2017 07:50pm
When will China take over PIA and rename it CPEC Airways!??
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May 13, 2017 08:02pm
And we sold one of our performing bank to the govt's cronies for mere rs 1000. When this corruption end and improve the condition of ordinary citizen. Now HOPE is all we have.
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May 13, 2017 08:05pm
It will easy for corrupt to launder money abroad through these foreign banks.
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May 13, 2017 08:07pm
@Dr. Salaria, aamir Ahmad - You could perhaps the question about 'believe' to our corrupt leadership.
And the answer may very well be, "In US Dollar We Trust."
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May 13, 2017 08:14pm
Good but Keep a check on over dependency...
Hope these silent moves aren't part of bigger strategic plan...
TO BRING PAKISTAN IN DEBT FROM ALL CORNERS....
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May 13, 2017 08:25pm
Welcome! China is a good counter weight to America.
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May 13, 2017 08:25pm
@Fast Interest rate is 8 percent. Each and every chineese dollar is a loan. This is what your news channels and news papers say.
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May 13, 2017 08:26pm
In any project it is essential to plan for the downside. Now, what happens to Pakistan if the revenue does not materialize from CPEC. Then how would the loans be replayed.
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May 13, 2017 08:27pm
Now they will open more branches and give loans to ordinary Pakistanis. This is a way they will mint billions in no time. I am still not sure we agreed for CPEC or are we giving free access to every important business areas which could be related to our national security as well. CHinese banks with their low interest rates may end up weaken our existing banking system.
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May 13, 2017 08:40pm
This is about step-by-step transplantation of the Chinese Renmibi, Yuan, currency to be the Currencia Franca! Checkmating and Displacing the overvalued hegemonic US$, the Euro €, British £, Japanese ¥, etc, in the Regional & Global Trade.
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May 13, 2017 08:44pm
China is the largest trading partner of Pakistan, due to economically low prices and fast deliveries most of Pak imports are from China. Opening of Bank of China is a defining moments in Pak Trade History,the bank's LC and other charges of Bank of China are much less than Pak banks,and certainly there will be a healthy competition. The businesses with China will be more fast,through Bank of China.
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May 13, 2017 08:45pm
@ASHOK “Both loans will carry less than 2 per cent interest rate. Both are concessional loans,”
Read this report and also the last para.
https://www.dawn.com/news/1287040
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May 13, 2017 08:47pm
@ASHOK Also Check this report. Two percent interest rates will be paid on CPEC loans.
http://dunyanews.tv/en/Pakistan/363879-Two-percent-interest-to-be-paid-on-CPEC-loans-Ahs
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May 13, 2017 08:48pm
@Farhan .The cartel of domestic schedule bank was exorbitantly charging from people,that will now face a competition,and banks charges will decrease. Besides Bank of China may also open a branch at Lahore and Faisalabad, there's a huge business potential.
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May 13, 2017 08:48pm
@Imtiaz syed I know sir you have Noble intension but I think you didn't understood this CPEC thing, what there for India for joining it. We have one of the longest coastal line with 100s of smaller and bigger port. Why would you think we will be transporting our goods to Pakistan via CPEC.
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May 13, 2017 08:51pm
Long live Pak China friendship.
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May 13, 2017 08:54pm
@Fast its 8% not 2%....5 billion a yr
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May 13, 2017 08:54pm
@ASHOK why are indians so concerned about Pak loans? Stop spreading fake news
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May 13, 2017 08:56pm
@Fast
Sir, your totally wrong, our chief economist said this week we will be paying pack $5billion a year. so 2% can't be correct.
Maybe your figures don't include Sinosure insurance and guaranteed rates of return ?
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May 13, 2017 08:56pm
Pakistani banks will now be gobbled up by Chinese Banks
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May 13, 2017 08:56pm
@Harmony-1©" @Thanks - Thanks!"
How original!
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May 13, 2017 08:56pm
China must Buy PIA too. They're running into Losses.
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May 13, 2017 09:01pm
Chinese first gave loans to Government, made them indebted to China.
Now they will give cheap loans to Pakistani public and make them indebeted to as well.
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May 13, 2017 09:05pm
@Fast Brother, Chinese investment is backed by 18% guranteed returns in US$ terms backed by sovereign gurantee of Pakistan. As for loans, it's NOT 2% interest but whopping 6%-8%, way too high.
Compare it with ADB, Japan etc. who lends at less than 1% interest to India.
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May 13, 2017 09:15pm
@Mahmood - Exactly :)
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May 13, 2017 10:29pm
Welcome to China 2,Years later pakistan would call as China
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May 13, 2017 10:35pm
@Khan Indians are concerned because finally not Sharif or zardari or Imran will be paying the loan, it will be paid by the common Pakistani citizens...
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May 13, 2017 10:51pm
@Imtiaz syed why we need to go for cpec when we already have land route to afghanistan thru wagah border, train between punjab and lahore.
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May 13, 2017 11:01pm
Recovery agent has arrived
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May 13, 2017 11:04pm
Awesome. One Road, one currency, one country.
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May 13, 2017 11:13pm
@Good luck all Pakistan people will pay to tax
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May 13, 2017 11:30pm
Great! All technical support is provided from Indian company from Hyderabad (India). I wont name my company.
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May 14, 2017 12:07am
Most welcome, soon Chinese Yaun is going to be an International currency.
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May 14, 2017 12:32am
Why can't Pakistan grow themselves.. earlier US now China.. come on it is not too late .. just invest in education...
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May 14, 2017 12:35am
Very Nice. Long live Pakistan/China friendship.
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May 14, 2017 12:48am
I will take loan from this bank and start a business. I will provide employment.
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May 14, 2017 03:25am
@Fast
Unfortunately your dear goverment keeps importing $ 50 billion worth of goods and only exports $20 billion. Even you have $2 billion deficit in services trade. What that means is you have already spent more than 50 % of CPEC value in just one year without any tangible benefits. Your forex reserves and FDI is lowest in whole south asia. You need to negotiate hard with Chinese. They dont believe in charity, they just grab everyone at their neck!
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May 14, 2017 04:28am
@Khan -- India is concerned as a neighbor of the possible consequences of the failure of great aspirations of Pakistanis resulting in total anarchy spreading to its lands. Right!
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May 14, 2017 04:38am
It was a matter of time. With dollars wxpected to roll once CPEC is operational.
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May 14, 2017 06:44am
Coming from an Indian, anything I say will be misunderstood.
But this is nothing but colonization. China will kill all local Pakistani businesses if you are not careful. The Chinese way of doing business is not something Indians and Pakistanis understand.
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May 14, 2017 07:47am
@Imtiaz syed i don't see how you see what you see . china is going to export stuff to you not import from you . how is pakistan going to make heaps of money
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May 14, 2017 08:57am
@Imtiaz syed India may not be intetested in CPEC as it exists today. But it is likely to be intetested in Ind-Pak-Afg-Iran development route. Hope common sense ans pragmatism prevails and peace cones tp the region.
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May 14, 2017 12:03pm
@Falcon1 Sooner than later
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May 14, 2017 12:05pm
@Good luck Not to worry. Anyways there is no intention to pay back.
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May 14, 2017 03:22pm
Best wishes Pakistan
As an Indian I feel China can manage Pakistan better and lead Pakistan to prosperity
Long live Indo Pak friendship
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May 14, 2017 04:05pm
It's good move.... Appreciated.
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May 15, 2017 02:47am
@Kumar and you are the expert on this subject and have a massive collection of books on Chinese way of doing business?
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May 15, 2017 06:47am
@Imtiaz syed what is India getting by joining CPEC please explain. Pakistan is not ready to give much needed transit route to Afghanistan for trade. Sorry first give access to Afghanistan by land route then can we decide to join CPEC.
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May 15, 2017 05:21pm
China announced to invest over 900 billions. Once money is invested and OBOR is active, China is going to demand countries open up doors to Chinese banks just they did with Pakistan. China is going to demand countries to make payments in Chinese currency and China is going to keep playing with currency devaluation and people will keep paying tremendous money. China will also replace dollars from these countries with Yuan. Possibilities are countless. First Process of setting up banks started ,
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May 16, 2017 12:28am
This is the start of the downfall of Pakistani Banks.
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