Foreign banks apply to expand services in China

Eight banks have applied to become the first foreign institutions licensed to handle retail business in Chinese currency, the government said as a WTO deadline for opening its banking market passed Monday.

Seventy-one foreign banks are represented in China but most were limited until now to handling foreign-currency business.

Beijing agreed to open the market as part of its World Trade Organization membership commitments. Its own banks have been racing to modernize in preparation for facing foreign competitors.

Banks that have applied for retail licenses are Citigroup Inc. of the United States, Japan’s Mizuho Corporate Bank, Britain’s HSBC Corp. and Standard Chartered, Dutch bank ABN Amro Holdings, Singapore’s DBS Bank and Hong Kong’s Bank of East Asia and Hang Seng Bank, according to Chinese regulators.

Rules that took effect Monday give them access to the local-currency retail banking business, in theory lifting all geographic and client restrictions on operations. Previously, foreign banks were allowed to offer such services on a limited scale in 20 major cities.