Pakistan’s largest bank becomes the first South Asian institution to operate in China.
Pakistan’s Habib Bank Limited on Monday announced it had received a license to open a branch in China, a move that would make it the first South Asian lender to operate in the world’s number two economy.
More commonly known as HBL, the bank said it would open a branch in Urumqi, the largest city in the province of Xinjiang, which lies along the traditional Silk Route and borders Pakistan. “Habib Bank Limited is the first South Asian bank to get this permission,” a bank statement said, without setting a precise timeframe for opening.
Urumqi is a growing commercial and trade center and the regional hub for China’s Belt and Road Initiative (B&RI) in Central Asia. The program is closely linked to the China-Pakistan Economic Corridor (CPEC), a $46 billion development project, which will connect Gwadar port in Pakistan’s Balochistan province to Xinjiang.
Hamza Kamal, an investment analyst at Shajar Capital said: “The bank could capitalize over the growing investment and trade activities between the two countries as it has already developed its reputation with the Chinese business and trade sector.”
Founded in 1947, HBL has over 40 percent of Pakistan’s banking market share.
Chinese investment in Pakistan grew in the first eight months of the current fiscal year to $523 million from $204 million in the same period last year. Pakistan imports over $5 billion in commodities from China every year.
The Industrial and Commercial Bank of China, one of the largest banks in China, has branches in Pakistan’s main cities Karachi, Islamabad and Lahore.