NEW YORK (BLOOMBERG) - Wall Street giants such as Goldman Sachs Group and JPMorgan Chase & Co have tens of billions of dollars at stake in China as political tension risks derailing the nation's opening of its US$45 trillion (S$63.8 trillion) financial market.. Read more at straitstimes.com.
NEW YORK - Wall Street giants such as Goldman Sachs Group and JPMorgan Chase & Co have tens of billions of dollars at stake in China as political tension risks derailing the nation's opening of its US$45 trillion financial market.
Profits in China's brokerage industry could hit US$47 billion by 2026, Goldman estimates, with foreign firms gunning for a considerable chunk. There are US$8 billion in estimated commercial banking profits as well as a projected US$30 trillion in overall assets to go after, also being pursued by fund giants such as Blackrock and Vanguard Group.
A body advising the US Congress this week questioned Wall Street's push, saying lawmakers need to"evaluate the desirability of greater US participation in a financial market that remains warped by the political priorities of a strategic competitor." Add to that potential sanctions against China and even its banks over the crackdown on Hong Kong, and the situation could further escalate.
Morgan Stanley won a nod to take majority control of its securities venture this year, and last year had a net exposure of US$4.1 billion to Chinese clients. Its local securities unit, however, has revenue of just 132 million yuan, posting a loss of 109 million yuan last year. JPMorgan's China total exposure in 2019 was US$19.2 billion, including US$11.3 billion in lending and deposits and US$6.5 billion in trading and investing.
Citigroup said last month that it has doubled its overall revenue from China to more than US$1 billion over the past decade.
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