Bank of China gets go-ahead for Swiss private bank

By Martin de Sa'Pinto

ZURICH (Reuters) - Bank of China said on Friday it had won regulatory approval to operate a private bank and an asset management firm in Switzerland, making it the first Chinese bank to enter the Swiss market.

The banking and asset management units have been carved out of Geneva-based asset manager Heritage Fund Management.

BOC bought 30 percent of HFM in late July and committed to raising its stake to 70 percent on receiving approval by the Swiss Federal Banking Commission on November 20 to operate in Switzerland under the BOC banner.

BOC has been bolstering its European operations this year.

On September 18 the Chinese bank announced it had bought a 20 percent stake in French bank La Compagnie Financière Edmond de Rothschild, a move it described at the time as "the first strategic investment by a leading Chinese Bank in a euro zone bank."

The new banking concern will be a wholly-owned subsidiary of BOC (UK), which is itself a subsidiary of the Bank of China group. Bank of China is majority-ownd by the Chinese state.

Jacques Mechelany will be chief executive of the private banking arm and chairman of the fund management arm, BOC said in a statement.

Mechelany, who founded HFM in partnership with private bank Banque Heritage in 2006, will own a 30 percent stake in the new entities.