On October 23, 2019 (Brazil local time), Banco Central do Brasil issued a formal approval of the establishment of 100% foreign bank — Banco XCMG S.A.
The setup of Banco XCMG S.A. will be completed within 6 months. The approval of Banco XCMG S.A. marks that Chinese construction machinery enterprises have achieved a breakthrough in the integration of industry and finance in Brazil and created a milestone in the financial services sector in South America.
Banco Central do Brasil (BCB) is the highest financial authority in Brazil. Its mission is to ensure the stability of the purchasing power of the currency and the robustness and efficiency of the country’s financial system (SFN), including access of foreign financial institutions.
A milestone of China’s capital in the financial services sector in the South America
Banco XCMG S.A. project was launched at the beginning of 2017. The project has gone through more than 10 processes such as policy consultation, inter-bank communication, field research, thematic defense meeting. After more than 2 years, the initiative was finally passed at the banks in China and Brazil
Banco XCMG S.A. is established to promote the sales of XCMG in Brazil, provide financial services that can meet the diversified needs of customers and promote the development of distribution network, including carrying out FINAME financing, consumer credit, financial leasing and other financial business.
On September 26, 2019, Brazilian President Bolsonaro signed a decree that foreign banks can enter the Brazilian market with sole authorization of Banco Central do Brasil. “We are deleveraging Brazil’s public banks,” says Brazil’s Economy Minister, Paulo Guedes. Banco XCMG S.A. is the first foreign bank directly approved by Banco Central do Brasil after the new decree took effect.
Financial internationalization promotes the upgrading of XCMG’s globalization strategy
In the late 1980s, XCMG took the lead to start internationalization in the industry. After 30 years of exploration and practice, it has broken a unique path of internationalization via four stages, namely, staff “going out”, product “going out”, enterprise and capital “going out”, brand and management system “going out”. It has formed “five-in-one” development model integrating trade, overseas plant construction, cross-border mergers and acquisitions, global research and development and international talents cultivation.
Brazil is the largest country in South America and a major member of BRICS countries. The economies of China and Brazil are highly complementary to each other. In recent years, China-Brazil economic and trade exchanges and investment cooperation have maintained rapid growth. China has become Brazil’s largest trading partner, largest export destination and largest import destination. In June 2014, XCMG Brazil Industrial Park Phase I was successfully completed and put into operation after 18 months of construction. In recent years, the scale of production and sales has continuously broken the historical record. With a favorable trend of development, the sales is in urgent need of greater financial support.
The approval of Banco XCMG S.A. has profound meaning for its internationalization campaign. XCMG has achieved financial service system focusing on overseas markets to improve its competitiveness and opened a new chapter of XCMG’s globalization