China may set foreign stakes in underwriting JVs at initial 33 pct - report

China is expected to permit foreign investment banks to take 33 pct stakes in new underwriting joint ventures, with the cap raised to 49 pct eventually, the Wall Street Journal reported.

Citing a source briefed by Chinese regulators, the report said the new joint ventures will serve a "seasoning period" as underwriters initially.

After an unspecified period, regulators could authorize other lines of business including proprietary trading, brokerage services and asset management, the report said.

The China Securities Regulatory Commission (CSRC) is expected to issue rules over the next few days detailing the extent of foreign participation, it said.

It added that Morgan Stanley and Credit Suisse Group have already signed preliminary agreements for new joint ventures which will operate under these rules.