(Bloomberg) -- Nigeria’s biggest bank is opening a new branch in Hong Kong in its first step of Asian expansion.
“Hong Kong is a pivot point as far as we are concerned into trade flows between Africa, China and the broader region,” Jamie Simmonds, Access Bank UK founding chief executive officer, said in a Bloomberg Television interview Thursday. “The international arm is critical as we support the increasing footprint of our parent across Africa.”
The push into the Chinese territory comes amid growing tension between the US and China and increased support for Africa from Beijing. Hong Kong is also seeking to build up its international status, focusing more on non-Western markets after years of strict Covid restriction and Beijing tightened its grip on the city.
Chinese President Xi Jinping in September unveiled a raft of economic sweeteners for Africa. That including a commitment to triple China’s credit lines to the continent to $30 billion.
“With that level of commitment, it’s hard not to imagine that the China, Africa trade will continue to expand and grow,” Access Bank Chief Executive Officer Roosevelt Ogbonna told reporters in Hong Kong on Wednesday.
The lender also established a representative office in Shanghai about ten years ago but views Hong Kong as a better gateway for international trade, Ogbonna said.
The bank targets to break even at the Hong Kong branch by 2027 with a focus on trade finance. It will seek to expand into commercial banking after turning a profit, according to Ernest Law, the branch chief executive.
The bank has rented half a floor at the city’s Two Exchange Square.
According to the local banking regulation, Access Bank’s Hong Kong branch is a so-called restricted license bank. It principally engages in merchant banking and capital market activities, and may take deposits of HK$500,000 ($64,345) and above. There are 16 restricted license banks by end-September according to the official list.
--With assistance from Paul van Deventer and Emele Onu.
©2024 Bloomberg L.P.