Barclays Capital is planning to launch a G-7 derivatives business onshore in China in the first quarter as it expects to open its first branch on the mainland within coming weeks. "Following our day-one products including G-7 spot, money market, loans and advisory, we will begin the application process for G-7 derivatives," said Paul Scanlon, spokesman in Hong Kong.
The firm is anticipating the Shanghai branch will get the stamp of approval from regulators and then it will apply for a G-7 derivatives license. However, as a newer entrant in the derivatives market, it will be some time, perhaps a year or so, before Barclays can move into the renminbi-denominated derivatives market, which has been opened to only a handful of foreign houses for FX forwards (DW, 9/16).
Additionally, the firm has applied for a qualified foreign institutional investor quota for the Chinese A-share market, for which firms can offer market access derivatives. Barclays hopes to receive the increase within the next few months, said Scanlon, noting the firm has tapped out its existing allotment of USD75 million.
