Credit Suisse and Founder Group's securities firm, Founder Securities, intend to apply for the establishment of a joint venture in the near future.
In addition, Credit Suisse and Founder Group intend to explore establishing a strategic alliance in areas such as domestic institutional brokerage and wealth management, when permitted under Chinese laws and regulations.
Subject to receiving all regulatory approvals, Credit Suisse and Founder Securities intend to enter into a joint venture to engage in the sponsoring and underwriting of A-shares, foreign investment shares and government and corporate bonds; the brokerage of foreign investment shares and the brokerage of government and corporate bonds. Credit Suisse proposes to take a 33.3% stake in the proposed joint venture.
In relation to the contemplated strategic alliance, Credit Suisse and Founder Group aim to enhance the strategic, market and financial position of Credit Suisse and Founder Securities in China, by creating an improved operating environment, and in turn contribute to the overall profitability of the financial services sector. The contemplated strategic alliance will also explore opportunities for greater levels of synergy between Credit Suisse and Founder Securities, and augment the breadth and quality of products and services offered to clients in order to create value for the parties. Finally, if and when relevant legislation permits, the parties may also seek regulatory approval for the joint venture to expand its scope of business.
"Credit Suisse believes that in Founder it has an extremely strong partner, with invaluable local expertise and experience in the Chinese financial services industry and we look forward to a strong and mutually rewarding relationship" said Paul Calello, CEO of Credit Suisse Investment Bank and member of the executive board. "I am confident that Credit Suisse's world leading franchise and Founder's local capabilities can combine to create an unrivaled alliance."