HONG KONG: An increasing number of overseas financial institutions have shown greater interest in setting up shops in Beijing, signalling a “go-North” trend among international banks and insurers.

“The mainland's financial sector is expected to open wider to overseas investors by the end of this year,” said Chen Gang, chief executive of Chaoyang District Government, referring to the Chinese mainland's commitments to the World Trade Organization (WTO). Chaoyang District, in the east of the nation's capital, is the richest area in the city.

“Beijing's financial market is full of potential,” he said.

Chen made the remarks at a CEO Seminar on Finance Industry Development of Beijing Central Business District (CBD) yesterday in Hong Kong. The event was co-organized with the China Daily CEO Roundtable.

Chaoyang District, which has the most overseas financial institutions in Beijing, would be a good place for newcomers, Chen said.

Its 4.8-square-kilometre CBD, already home to 37 overseas financial institutions, is in talks with about 10 banks and insurers thinking of moving or setting up branches in and around the area, Chen said.

Citing a number of preferential policies such as 1,000 yuan (US$125)- per-square-metre subsidies to overseas investors buying offices, Chen said the CBD would provide them with a home away from home.

He also said the government is working on a package of measures to improve services and transport in the district. It is also pressing ahead with infrastructure construction, in an attempt to make it a famous business centre like Hong Kong and Manhattan.

Chaoyang's effort to attract more financiers from abroad pays off as they attach greater importance to the North China market. According to the mainland's WTO commitments, it opened later than other markets such as Guangzhou and Shanghai.

Since 2004, a number of overseas financial firms have moved their China headquarters to Beijing from southern cities. Generali China Life, a Sino-Italian life insurer, is the latest example of this trend. It moved its base from Guangzhou to Beijing in February.

“We came because of the market potential,” said You Yibing, a company director.

He also spoke highly of the CBD, saying it provided first-class facilities and services in Beijing.

Home to 159 embassies and hundreds of multinational companies' regional headquarters or representative offices, Chaoyang District also delivers “fantastic” international resources, he added.

Hong Kong banks, which enjoy privileges in carrying out renminbi business under the Closer Economic Partnership Arrangement (CEPA), were pioneers in entering the Beijing market, said Frederick Ma, secretary for financial services and the treasury in Hong Kong, speaking at the seminar. CEPA is a free trade agreement between the mainland and Hong Kong.

“Beijing is now a focus of the world's financial institutions,” he said. “Since the implementation of the CEPA two years ago, ties between the financial sectors in Beijing and Hong Kong have intensified.”

Major Hong Kong players such as HSBC have established branches in Beijing.

Smaller lenders are mulling over whether to enter Beijing.

“We are considering opening a branch in Beijing,” said Howard Wu, assistant general manager of Hong Kong-based Wing Lung Bank, the first local bank that set up a branch on the mainland after the implementation of CEPA.

Wu said Wing Lung would study the feasibility and expressed interest in the CBD.

“The (CBD) may be a choice,” he told China Daily.

Wing Lung now has two branches on the mainland, both in Shenzhen.