A JPMorgan Chase & Co. unit applied with the China Securities Regulatory Commission to set up a brokerage joint venture in China, The Wall Street Journal reported May 10, citing Gao Li, a spokeswoman for the regulator.
The spokeswoman said the CSRC received an application from J.P. Morgan Broking (Hong Kong) Ltd. to hold a 51% stake in the joint venture, adding that the regulator will review the application.
The report came after China in April eased foreign ownership restrictions on domestic securities brokerage and asset management joint ventures, allowing foreign companies to own majority stakes.
The move is part of JPMorgan's strategy to invest and learn more about doing business in China, a person familiar with the matter said, adding that the company hopes to incorporate more corporate bankers in the country. The regulatory process will likely take time, the person added further.
JPMorgan is the latest foreign company to apply for a controlling stake in a brokerage in China after Japan's Nomura Holdings Inc. and Switzerland-based UBS Group AG. Nomura plans to establish a joint venture brokerage in China and hold a 51% stake in the venture, while UBS applied to hold a majority stake in its existing Chinese securities joint venture.