Credit Suisse and Citigroup are vying for a Chinese brokerage as they seek a partner for an investment banking venture, it has been reported.
Credit Suisse has signed a preliminary agreement with Founder Securities to embark on the venture, according to unnamed sources cited by Reuters.
However, Citigroup has also approached Founder Securities with a view to setting up a similar venture, it has been claimed.
It is thought that Credit Suisse is seeking a deal whereby it takes a 33 per cent stake in the business as well as management control.
The resulting venture would underwrite corporate bonds and stock sales.
News of competition among Western banks for business in China follows the announcement from the Chinese government in May that it is planning to recommence granting licensing for securities ventures in the second quarter.
Under Chinese securities rules, a foreign investor can hold a maximum stake of 33 per cent in an investment banking joint venture and is able to buy up to a 20 per cent stake in a domestic stock broker.