China Construction Bank said it has been frustrated by the United States in its attempts to expand there and is not interested in buying into investment bank Bear Stearns .
Chairman Guo Shuqing on Wednesday dismissed market talk that China's second-biggest bank might invest in Bear Stearns, which is among those firms hardest hit by the U.S. subprime mortgage crisis.
Guo's comments came a day after a Chinese official said CITIC Bank would like to acquire a holding in Bear, the smallest of Wall Street's five big independent brokerages.
"We are a commercial bank, and commercial banking is our main business," Guo told reporters when asked about Bear Stearns. "The institution you just named, according to my understanding, is an investment bank. Currently we have no plans."
Bear Stearns Chief Executive James Cayne said earlier this month it would consider selling a stake to an investor from China or the Middle East.
Media reports have cited CCB and CITIC among potential Bear Stearns suitors along with Bank of America , Wachovia and billionaire investor Warren Buffett.
A CITIC official on Tuesday reported no progress in its talks with Bear Stearns.
Guo had harsh words for U.S. regulators. Whereas China had opened its banking market to foreign banks from the United States and elsewhere, CCB had been trying to open a branch in the United States but had so far failed win approval.
"In the past we may have had our problems, for instance low capital adequacy and bad performance, but now the situation has completely changed," he said. "Yet the U.S. side has still not changed its attitude. It is abnormal and unfair."
Bank of America, which holds a strategic stake in CCB, has agreed not to conduct retail banking in China, but this would not prevent CCB from entering the retail market in the United States, Guo said.
If it did so, it would cooperate with BoA, he added.
Guo said CCB, which is also partly owned by Singapore's Temasek Holdings, was keen on overseas mergers and acquisitions but he refused to disclose any specific targets.
He did, however, say the bank hoped to expand in Japan. CCB would also look at other countries that enjoy close economic relations with China.
Flush with cash after big IPOs, China's big banks are starting to spread their wings overseas.
Industrial and Commercial Bank of China, the world's largest bank by market capitalisation, said it planned to open branches in Doha, Dubai, Moscow and Sydney.
"As the whole world knows, the Middle East is a fast-growing region with lots of capital. Just as in China, there are many opportunities for banks," Chairman Jiang Jianqing told reporters at a separate briefing.
Jiang said he wanted overseas business to account for 10% of ICBC's total revenues, up from 3 to 4% now.
CCB Chairman Guo also said Chinese regulators had not yet approved the bank's proposal to set up a life assurance company with Ping An Insurance, China's second-largest life underwriter.
A request by CCB International, a wholly owned Hong Kong subsidiary, for a mainland banking licence is also still awaiting approval, he added.
Guo acknowledged that Chinese banks were under increasing pressure on their home turf from foreign rivals but said stiffer competition was good for the industry.
CCB shares were down 0.4% in trading in Hong Kong after Guo's comments, but have nearly doubled over the last year as investors seek stocks that are benefitting from China's booming economic growth.