TORONTO and BEIJING, Dec. 30 /CNW/ - Scotiabank today announced that it has completed the acquisition of a further 13.2% stake in Xi'an City Commercial Bank ('XACB'), a leading city commercial bank in Western China, increasing Scotiabank's holding to 14.8%. In addition, Scotiabank has entered into definitive agreements that upon receipt of final regulatory approvals, will see the bank's ownership stake in XACB increase to 18.1%. When completed, the total investment in XACB will reach C$162 million. After closing, Scotiabank intends to acquire additional shares from private sources to reach a total combined stake of approximately 20%, the regulatory limit for foreign bank investments in China.
"The China market has strong fundamentals with very good long-term growth prospects," said Rob Pitfield, Group Head, International Banking, Scotiabank. "Scotiabank's increased investment in Xi'an City Commercial Bank is a great opportunity for us to capitalize on the strength of the China market and on the strong relationship that we have already built with XACB."
As a result of today's announced agreements, XACB's major shareholders now include Scotiabank, China Cinda Asset Management Co and Xi'an Municipal Government related entities. The increased ownership in XACB will increase Scotiabank representatives on XACB's Board of Directors from one to two and also increase Scotiabank's representation within the senior management team from one to three.
"Xi'an City Commercial Bank is a solid financial institution, with a strong presence as a leading bank in the city of Xi'an, a major city in Western China with over 8 million people," added Michele Kwok, Senior Vice President, Asia/Pacific & Middle East. "We are confident that this additional investment will enable Scotiabank to continue to add strategic value that will generate strong financial returns. We look forward to working closely with all new and existing shareholders and with the management of the bank."
About Xi'an City Commercial Bank
XACB is one of China's leading city commercial banks located in the city of Xi'an, the capital of Shaanxi Province, which is in the western part of China. Established in 1997 through a consolidation of 42 urban credit cooperatives, XACB provides a full range of personal and commercial banking services to the local people and companies in the region. The Bank also has significant potential to expand outside of Shaanxi province. Serving over 1.2 million customers with 2,200 staff across 113 branches, XACB ranks third in terms of loan market share in Xi'an, with total assets of RMB 51.6 billion (approx. C$9.3 billion) as of December 31, 2008.
About Scotiabank
Scotiabank operates in 11 countries and territories in the Asia-Pacific region, with about 650 employees. The bank primarily offers corporate and commercial products and services, including loans, trade finance, treasury, precious metals, foreign exchange, correspondent banking, loan syndications, securities investment and investment banking and retail mortgage financing in selected countries within the region. Scotiabank also owns 49% of Thanachart Bank PCL, Thailand's eighth largest bank and leading automobile lender. Scotiabank has been in China since it first opened a Representative Office in Beijing in 1982.
Scotiabank is one of North America's premier financial institutions and Canada's most international bank. With close to 68,000 employees, Scotiabank Group and its affiliates serve approximately 14.6 million customers in some 50 countries around the world. Scotiabank offers a diverse range of products and services including personal, commercial, corporate and investment banking. With more than $496 billion in assets (as at October 31, 2009), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit www.scotiabank.com.
