Pedestrians stand along the Bund as skyscrapers of the Pudong Lujiazui Financial District stand across the Huangpu River in Shanghai, China.
While Wednesday’s changes could lead to full-blown local bank takeovers – a potential shortcut into the market – the likes of JPMorgan Chase and Goldman Sachs Group may have to wait years before finance in China looks like Wall Street or the City of London. The changes build on steps China’s leaders have taken in the past 18 months to level the playing field between overseas and local firms, as they’ve come under increasing pressure from US President Donald Trump’s administration.
While China has taken measures to ease barriers of entry for global firms, the efforts haven’t so far changed the competitive landscape. In sectors from banking to insurance and brokerage, local firms still dominate with more than 90% market share. The thresholds were previously US$20 billion and US$10 billion, respectively Allow overseas financial institutions to invest in foreign insurers in China.