HK share deals on local horizon

SHANGHAI investors may be able to begin making direct trades in Hong Kong shares as early as next week, an informed source said yesterday.

The 10-plus wealth management centers under the Bank of China in Shanghai are now accepting inquiries on the trial service.

"Our client relationship manager will call you when the service kicks off," said a BOC employee at a wealth management center, declining to specify a precise time.

The service may be launched as early as next week in Shanghai, a source close to the process told Shanghai Daily. The bank is speeding up training on the new product, including sending staff to Tianjin, where the Hong Kong trades will be launched first, the source said.

The State Administration of Foreign Exchange approved the trial program on August 20, saying it will allow private investors to trade Hong Kong shares directly via mainland accounts from the Bank of China in Tianjin. The move is designed to help ease China's growing cache of foreign reserves.

A BOC International official said yesterday that the Hong Kong service will be launched "in days" in Tianjin or as late as next week. After that, it will be expanded to 40 major cities, the bank said earlier.

Participants will have to invest a minimum HK$100,000 (US$18,200).

Meanwhile, BOC's Tianjin branch said yesterday it has taken contact information from nearly 2,000 potential clients so far.

Several other banks plan to enter the fray.

Zhang Jianguo, president of China Construction Bank, said the lender has applied to the foreign exchange regulator to begin offering the Hong Kong equities services. The Bank of Communications and the Industrial and Commercial Bank of China were also reported to be interested, though the two lenders declined to comment publicly on the issue.

"We will inform the media if there's an announcement," an ICBC official said. "Please be patient."

At present, Chinese mainland citizens can trade in overseas stocks only through the Qualified Domestic Institutional Investor program. Offered by banks, brokers and insurance companies, the QDII program features funds based on overseas securities.