Shanghai bourse to see foreign listings

The Shanghai Stock Exchange will launch an international board next year to allow foreign companies to sell shares in China for the first time, Chinese media said yesterday.

The larger of the nation's two bourses is proceeding with preparations as part of Shanghai's long-term plan to become a financial hub by 2020, the Shanghai Daily reported, citing Vice- Mayor of the city Tu Guangshao.

"The board is expected to be launched next year," Tu told the newspaper.

Currently, no foreign companies can list in the domestic stock market.

China started working on the international board two years ago, but the programme has proceeded slowly due to local investor concerns that a potential stock glut could negatively impact the market, said the report.

The government, which has yet to unveil rules governing how foreign companies can sell shares in China, said previously it would eventually allow qualified foreign firms to list in the Shanghai Stock Exchange.

A listing in China is attractive because it will provide an opportunity to access the nation's massive deposits in the local currency, while also helping foreign firms with China operations promote awareness of their brands.

Global banking giant HSBC Holdings, which had been reported to be vying to become the first foreign company to sell shares in Shanghai, confirmed yesterday it had hired advisers for a possible share offering. "We have confirmed we have appointed people. It depends when the regulators actually put regulations in place," said Gareth Hewett, a Hong Kong-based HSBC spokesman.

HSBC has mandated two major domestic brokerages – China International Capital and Citic Securities – as bookrunners on its planned Shanghai IPO of three billion to five billion dollars, Dow Jones Newswires said on Tuesday.

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