TORONTO — Scotiabank’s patience is apparently wearing thin over delays by Chinese authorities in approving a planned $719-million investment in a bank in a fast-growing region of China.
Canada’s most international bank (TSX:BNS) wants to acquire just under 20 per cent of the Bank of Guangzhou, the maximum stake allowed under Chinese law.
However, it has been waiting more than a year for Chinese approval and CEO Rick Waugh says it won’t wait forever to close the deal.
Waugh, speaking at a conference in Toronto, described the proposed investment as a very intriguing opportunity that the bank has been focused on for a year, and for which it raised the required capital.
However, he says there are a “world of opportunities” for the bank and that it will find another place for the investment if it has to.
In 2011, Scotiabank announced it had been chosen as the winning bidder to acquire a 19.99 per cent of the Bank of Guangzhou, a closely held Chinese bank that is primarily government owned.
BGZ operates in a region of southern China with an expanding middle class that has benefited from China’s growing trade with the world. The Chinese bank has a growing retail customer base and also focuses on providing corporate and treasury services to companies in China.
Guangzhou is the capital of Guangdong province, which surrounds Hong Kong, and is home to a large manufacturing base.