Nov. 7 ICBC in Abu Dhabi, the capital of United Arab Emirates (UAE), announced the opening of its Abu Dhabi Branch under the approval of the Central Bank of United Arab Emirates. Earlier, ICBC secured a wholesale banking license from the UAE's Central Bank in December, 2009, becoming the first Chinese bank to get the license from central bank in the Middle East. The license to ICBC is also the first banking license since 1982 issued to a non-Persian Gulf region lender.
The opening of Abu Dhabi Branch means ICBC is allowed to conduct business using the UAE's local currency (dirham) and join the local electronic clearing system and cheque clearing system. With a local presence through this new Branch, ICBC is able to serve the local customers and help further expand the bilateral trades and investments between China and United Arab Emirates.
In 2008, ICBC opened ICBC Middle East in UAE's Dubai and Doha Branch in Qatar's capital. The new Abu Dhabi Branch together with the two ICBC subsidiaries in Dubai and Doha underscore ICBC's footprint in the Middle East. Thanks to the "offshore" and "onshore" licenses issued to the ICBC's three subsidiaries, ICBC can now spread its wings in the region to achieve best possible premium.
Since its entry into the Middle East, ICBC has been an active player in the infrastructure development of the region. Energy, telecom, transportation are some of the sectors that ICBC participated to help drive the trade between China and Middle East countries. Growth of ICBC businesses in the region is impressive.
ICBC begins to make its mark and becomes the mainstream commercial bank in the Middle East. By the end of October, 2010, ICBC has handled a volume of nearly 3 billion US dollars for financing and other different financial services to the Middle East customers, and 13 billion US dollars for Chinese enterprises to participate in Middle East's key projects.
ICBC sets its eyes on the local Middle East market, a market expected to offer greater potential. In April 2009, ICBC Middle East subsidiaries acted as Mandated Lead Arranger to join the Dubai Government's syndication of a 635 million US dollars financing facility. ICBC lent 100 million US dollars. This is the first project of ICBC Middle East subsidiaries taking part in Middle East local syndication and Islamic finance, a prelude to the ICBC upcoming business expansion in the region.
Meanwhile, ICBC has placed its focus on the telecom sector and built good partnership with the telecom operators in the whole Middle East and North Africa region after two years of effort, in a bid to expand its business scale. In 2009, ICBC Middle East subsidiaries have committed in a letter of intent to extend credit of 1.
5 billion US dollars to Emirates Telecommunications Corporation ("Etisalat"), and issued letter of intent to Qatar Telecom on the 1 billion US dollars loan. Meanwhile, ICBC Middle East subsidiaries helped the conclusion of a framework agreement in Geneva between Etisalat's Saudi Arabia Company and ICBC regarding a financing facility of 500 million US dollars.
Up to end-October 2010, ICBC Middle East subsidiaries have extended nearly 200 million US dollars in trade facility to the Middle East telecom operators.
In its development strategy, ICBC Middle East subsidiaries set out the mission to serve Chinese enterprises to "go global" since its inception, targeting to offer financial services to the pacesetting companies of different industries. PetroChina, Sinopec, CNOOC, Huawei and China State Construction Engineering Corporation are some of the examples.
In less than two months since the first day of operation, ICBC Middle East opened a performance guarantee of 330 million US dollars and an advance payment guarantee of 260 million US dollars to PetroChina Abu Dhabi for the smooth progress of its crude oil piping project. In 2009, ICBC Middle East received laurels for all the guarantee and factoring services (not in home currency) offered to Chinese enterprises (CNOOC, Huawei) for their business expansions in Middle East.
The establishment of Abu Dhabi Branch let ICBC deliver services in UAE currency, which reinforces ICBC to better serve the Chinese enterprises and customers there with all the full financial services required.
China and United Arab Emirates are very complementary to each other in terms of economy. Bilateral trades and investment activities are booming. United Arab Emirates has been the biggest export market in west Asia and Africa for China for 17 years in a row. In 2008, turnover of bilateral trades between China and United Arab Emirates reached 28.
155 billion US dollars, a year-on-year growth of 41%. In terms of direct investment, there are already more than 3000 China-invested companies in United Arab Emirates, where a number of big companies from China have set up their branches or even regional headquarters. Abu Dhabi, the capital of United Arab Emirates, has 9.
5% of the world's demonstrated oil reserves which places it at the 5th position in the world. Rich oil and gas resources, good geographical location make Abu Dhabi a very important city in the Gulf or even in the whole Middle East region.
The opening of ICBC Abu Dhabi Branch is one further step of ICBC to gain its foothold in the Middle East, to build a platform for ICBC to extend its reach in Middle East or even to North Africa. Once Abu Dhabi Branch "sets its stone", ICBC strides boldly its pan-Middle East framework across all key markets in the city chain of Abu Dhabi Dubai- Doha, in the country chain of United Arab Emirates Qatar, in the customer chain of local customer foreign customer and in the license chain of offshore-onshore.
In particular, the offshore and onshore licenses will help ICBC strengthen its service capacity. By working on the "2+1>3" synergy using the offshore license and onshore license held by the Middle East subsidiaries, ICBC can concentrate to allocate the right resources (capital, businesses, customers or skilled staffs) to deliver competitive services in the region through an interplay of commercial banking services and investment banking services.
ICBC is the largest commercial bank in China. It maintains market leading position in almost all commercial banking businesses in China backed by its solid customer base, cutting-edge IT technology and diversified product portfolio. Over the past few years, ICBC gathered its momentum in its performance, management and profitability.
Today, ICBC is the most profitable commercial bank in the world with the largest market capitalization, the largest customer deposits and the highest brand value. In recent years, ICBC has escalated its international presence through new branches and scaled up its business areas to offer financial services across the globe.
At the end of September, 2010, ICBC has 194 subsidiaries outside Mainland China in 27 countries/regions, shaping up a global business network spreading over five continents (Asia, Africa, Europe, America, Australia) worldwide.
