HSBC has a three-year head start on its foreign investment banking rivals in China because of the British bank’s unique position of having management control of its securities venture in Shenzhen, chief executive Stuart Gulliver said Thursday.

Gulliver’s comments come after China announced it will allow foreigners to control their onshore operations. Currently non-Chinese groups are limited to 49 percent stakes in joint ventures in the fast-growing market.

HSBC’s 51 percent control of HSBC Qianhai Securities is unique because it was able to use its long-established Hong Kong unit to take advantage of a rule favoring banks based in the city.

Many international banks are keen to launch new Chinese ventures with majority control or to boost their stakes in existing partnerships to help integrate those operations with their global networks and to better manage reputational risk, bankers have said.

But it will be some years before things fall into place for foreign majority-owned ventures to kick off, according to HSBC’s CEO.

“The regulations will come in two years time. Then you have to pick your partner and you’ve got to hire people — we think we’ve got a three-year head start,” Gulliver told a media briefing at the launch of its securities joint venture in Shenzhen.

The joint venture, with Qianhai Financial Holding Co., an investment unit controlled by local government, is part of the U.K.-headquartered bank’s “pivot to Asia” — a strategy launched in 2015 that aimed to capitalize on its strong links in the region and the closeness of China’s Cantonese-speaking Pearl River Delta region to HSBC’s Hong Kong stronghold.

The venture’s license allows HSBC to underwrite bond and equity sales on the mainland and to act as a broker for shares listed in Shanghai and Shenzhen. It can also publish research on Chinese companies to local clients.

(SD-Agencies)