China opens securities market to foreign firms

SARS-hit China has taken a historic first step and opened its securities market to foreign firms by granting licenses to two overseas financial companies to tap the domestic market estimated to be worth $500 billion.

UBS Warburg and Nomura Securities became the first two financial service firms to get qualified foreign institutional investor (QFII) licenses, the China Daily reported on Tuesday.

A spokeswoman of the China Securities Regulatory Commission -- the nation's securities watchdog -- said more QFII applications from foreign institutions were being reviewed. They should be approved if they meet the required criteria.

Deutsche Bank and Goldman Sachs, two global banking giants, are among those waiting in wings for a QFII license.

It is an entry ticket to China's $500 billion worth share market as well as the bond market, which used to be only available to domestic traders.

Global investment bank UBS Warburg led all others in the pursuit of a licence, as it was the first to lodge a QFII application with the CSRC in mid-March.

"We are delighted and very excited to be among the first to gain approval," Rodney Ward, chairman of UBS Warburg Asia, said.