For those of you keeping score at home, here’s an update on the foreign bank situation in China (from Xinhua):

The China Banking Regulatory Commission (CBRC) announced on Sunday it has approved nine foreign-funded banks to transform their Chinese branches into locally incorporated banks registered on the mainland.

    The nine banks, all to be registered in Shanghai, are the Standard Chartered Bank, the Bank of East Asia, the Hongkong and Shanghai Banking Corp., the Hang Seng Bank, the Mizuho Corporate Bank, the Bank of Tokyo-Mitsubishi UFJ, the DBS Group, Citibank and the ABN Amro Bank.

Note that the banking sector was liberalized further on December 11, allowing foreign banks to compete for individual RMB depositors, with some limitations. These are the guys that were first in line.

Some of these banks, including HSBC and Citibank, are trying to grow a retail presence in China, and everyone is waiting with baited breath to see whether they will succeed. This will be a nice topic of discussion in 2007 for bloggers, bankers and virtually everyone in the financial services sector. On the law side, I will be curious to see how the banks deal with the retail issues in China (e.g., employment, real estate, licensing). So far, most of their high-level legal people here have probably dealt mostly with regulatory issues. Could be a bit of a learning curve at the start.