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Thursday, March 26, 2015, 14:55

China's first private bank begins lending

By Xinhua
China's first private bank begins lending
This file photo captures a building of the Wenzhou Minshang Bank in Wenzhou city, east China's Zhejiang Province. (Photo / Chinanews)

WENZHOU, Zhejiang - The first private bank in China's mainland opened for business in coastal Wenzhou city, east China's Zhejiang Province on Thursday.

The Wenzhou Minshang Bank announced its ambition to target niche markets to offer inclusive financial services for small businesses, the self-employed, community residents, and county-level rural sector.

The bank completed its first credit service on Thursday, issuing a 300,000 yuan (US$48,289) loan to Jiangda Electronic Co. Ltd., a small electronics and aluminum foil producer.

Ma Ziguang, general manager of Jiangda Electric Co. Ltd.,told Xinhua his company, which focuses on export, often lacks capital.

"The bank's easily-applied loan service is swift and handy," he said adding the loan was given without any mortgage as the lender values the company's production performance and reputation.

The bank's main sponsors are electronic equipment producer Chint Group, industrial chemical maker Huafon Group as well 11 other large share holders, which include industrial firms, clothing manufacturers, real estate and high-tech firms. It was among the first three private banks approved by the China Banking Regulatory Commission (CBRC) in July last year.

According to the Wenzhou subsidiary of CBRC, the government has set up a very high "threshold" for approving the first private banks, taking in full consideration for share holders' competitiveness, brand image and credit.

All the share holders are leaders in their respective fields and have corporate assets worth tens of billions of yuan.

Nan Cunhui, chairman of the bank's biggest share holder Chint, acts as the bank's chairman.

Nan said the bank will mainly target small enterprises and community customers who need convenient and comprehensive financial services.

CBRC's approval of private banks, including two that are preparing to open -Shanghai Huarui Bank Co., Ltd. and the Shenzhen-based Webank, which was partly funded by Chinese Internet giant Tencent -- is seen as China's "ice-breaking" reform set up to dismantle the defacto monopoly by state-owned banks.

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