UBS Eyes Strategic Alliances With China's ICBC Amid Global Expansion: Report

UBS Group AG UBS has reportedly inked a memorandum of understanding with Industrial And Commercial Bank Of China Ltd.IDCBY IDCBF to look for strategic alliances in China and overseas markets.

The banks are considering collaboration in areas such as asset management, wealth management, and investment and corporate banking, Reuters reported.

The agreement encompasses product creation and distribution, client engagement, global market transactions, research, investment strategies, financing, asset safeguarding, and knowledge sharing, the report added.

In a strategic move last June, UBS acquired its competitor Credit Suisse. This acquisition paved the way for UBS to secure a 20% interest in ICBC Credit Suisse Asset Management Company, a collaborative fund initiative once co-owned by Credit Suisse.

Also Read: UBS Closes Credit Suisse Takeover, Projects CET1 Ratio of 14% in 2023

UBS Group CEO Sergio Ermotti said that China is an essential market for UBS, which has been present in the nation for more than 30 years, according to a note by AASTOCKS. This partnership will help further ramp up UBS's China strategy.

Other noteworthy banks like JP Morgan Chase & Co. JPM are also trying to fortify their footprints in China. 

JPMorgan clinched total dominance over its China mutual fund collaboration, echoing competitor Manulife Financial Corporation MFC by sidelining local allies to grasp full command in the multi-trillion-dollar lucrative market, as noted by Bloomberg earlier this year.

Also See: UBS Slashes 70% Of Credit Suisse's HK Research Staff Post-Integration: Report

Price Action: UBS shares are trading lower by 0.98% to $25.12 on the last check Tuesday.