Jan. 25, 2007 (China Knowledge) – Merrill Lynch, Goldman Sachs and other foreign brokerages are eyeing the 33% stake held by BNP Paribas in Changjiang BNP Paribas Peregrine, a joint venture with China's Changjiang Securities, sources told the South China Morning Post.

Merrill Lynch and Goldman Sachs declined to comment. A Changjiang BNP spokeswoman said she was unaware of the matter.

International Finance Corp, the World Bank's investment arm, is also awaiting approval for its plan to buy a small stake in Changjiang BNP.

BNP Paribas, France's largest bank, recently announced its withdrawal from the joint venture as both parties had “different views on the future development of the joint venture” and had come to an “amicable consensus” for BNP to transfer its entire equity stake to Changjiang.

Foreign brokerages were lining up to buy the stake as it remained difficult to get a license on their own in an industry the government was trying hard to protect through a series of measures. China Securities Regulatory Commission (CSRC) had announced in September last year that it will suspend the issuance of new licenses to brokerage houses in principle.

Only seven joint-venture securities firms have been formed so far. These are China International Capital Corp, BOC International (China), China Euro Securities, Changjiang BNP Paribas Peregrine Securities, Daiwa SMBC-SSC Securities, Goldman Sachs Gaohua Securities and UBS Securities.

Merrill Lynch signed a memorandum of understanding with Huaan Securities in January 2005 to set up a venture but has not yet received final regulatory approval.

Related Links:

China suspends issues of new brokerage licenses
http://www.chinaknowledge.com/news/news-detail.aspx?cat=general&id=4327

BNP Paribas quits Changjiang JV
http://www.chinaknowledge.com/news/news-detail.aspx?ID=5706