The Bank of China to Enter UK Mortgage Market

It has been announced recently that one of the largest banks of the People’s Republic of China -Bank of China Ltd. – has plans to expand onto British residential property lending market. The retail head of the British unit at Bank of China, Mr. Xixu Sun claimed that the bank had no opportunity to expand onto the UK market as it didn’t have a choice of good customers. However, these days, the lending terms of most UK banks are very strict, which gives foreign banks a clear advantage. Mr. Sun explained that the Bank of China, which is, by the way, the country’s 3rd largest bank and is state-owned, intends to win the loyalty of British prime-customers – people with good or excellent credit history, who still have hard time getting a mortgage from British lenders. The head of the UK branch at the Bank of China is determined that the task is more than accomplishable because the number of mortgages approved by traditional UK banks and building societies barely reached 50% of that in the past 4 years (48,000 vs. 108,000). Previously, the Bank of China’s unit in Great Britain was targeted at the ethnic Chinese community; however it now plans to expand its assets worth £7 billion beyond that. According to the Bank’s statement, its mortgage products will be available through 4 mortgage distributors and 15,000 mortgage brokers in the UK. Currently, the Bank of China Ltd. has 5 branch offices in Great Britain with 2 located in London. All mortgage applicants will have to go through an in person interview before their application gets approved, said Mr. Sun. He also added that the sum of deposit required by the Bank of China has significantly grown during the past year. UK mortgage brokers warmly welcomed the expansion of the Bank of China as, according to the latest data, demand for mortgage in the United Kingdom exceeds the supply.