(Yicai Global) Jan. 28 -- In order for foreign financial institutions in China to take full advantage of the unprecedented opening up of the country's capital markets in the last three years, they need to stand out from their domestic counterparts and provide value in different areas, the president of Deutsche Bank China told Yicai Global in a recent exclusive interview.

“We have certainly benefited,” said Zhu Tong, who is also general manager of Deutsche Bank in China. The Frankfurt-based lender was among the first batch of overseas banks to obtain a domestic bond market underwriting qualification in the country in September 2019. This was followed by a securities investment fund custody license in late 2020 and a primary dealer license for open market business in April 2021.

These licenses give Deutsche Bank new growth points in China, Zhu said. On obtaining these ‘admission tickets,’ foreign banks need to clearly recognize their positioning as different from domestic financial institutions and provide a value-added service, she said.

“Wealth management will be one of Deutsche Bank China’s development directions as the Chinese people have now accumulated a certain amount of wealth and need targeted services,” she said.

Green finance is another area of focus, Zhu said. “We will serve as a bridge between Chinese and foreign institutions to better connect international standards with Chinese ones. For example, we aim to help Chinese companies issue green bonds in Europe that are recognized by European investors.”

Fintech is also a long-term strategic direction of Deutsche Bank China, Zhu said. Although this is not expected to generate a direct source of income in the short term, the banking industry can start to explore future financial innovations.

Meanwhile, foreign banks in China should not ignore their original overseas customers as there is increasing demand for Chinese-yuan denominated assets. Foreign investors used to only be able to invest in the Chinese capital market through the Qualified Foreign Institutional Investor scheme, but now they can set up their own securities or asset management companies in China, she added.

Editors: Tang Shihua, Kim Taylor