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First Capital buys JPMorgan stake in Chinese securities joint-venture
December 16, 2016 / 1:53 PM / a year ago

First Capital buys JPMorgan stake in Chinese securities joint-venture

HONG KONG (Reuters) - First Capital Securities Co Ltd (002797.SZ) plans to acquire JPMorgan Chase & Co’s (JPM.N) minority stake in a Chinese joint venture, in what would be the first departure by a prominent global investment bank from China’s securities sector.

The Shenzhen-listed securities group said in an exchange filing on Friday that it would buy the 33.3 percent stake in joint venture JP Morgan First Capital Securities Co for 306.8 million yuan ($44.11 million).

JP Morgan First Capital Securities will become First Capital Securities’ wholly-owned subsidiary after the transaction, according to the filing.

In October, JPMorgan was in talks to sell out of the joint venture with First Capital Securities.

Investment banks like JPMorgan have taken minority stakes in such securities ventures. But lack of control and limited contribution to total revenue has created some frustration at a time when domestic competition has become more intense.

Almost all leading investment banks, including Goldman Sachs Group Inc (GS.N), UBS Group AG (UBSG.S), Morgan Stanley (MS.N), Deutsche Bank AG (DBKGn.DE) and Credit Suisse Group AG (CSGN.S) have securities ventures with local firms.

Reporting by Meg Shen. Editing by Jane Merriman

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