(Photo : Shanghai)

Just a few weeks before the official launching of the Shanghai Free Trade Zone (FTZ), the China Banking Regulatory Commission (CBRC) in Shanghai has invited foreign banks HSBC and Standard Chartered to open branches in the mainland's first free-trade zone.

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According to a report by the South China Morning Post, the two banks were among the foreign banks that the Chinese banking regulator has tapped to open business at the Shanghai FTZ in order for the government to understand who they plan do to business in the zone.

The Shanghai Free Trade Zone is expected to be officially launched on September 27, authorities said. The Shanghai banking authority is contacting a small group of foreign banks, including HSBC Bank and Standard Chartered Bank for a deeper understanding of how foreign banks will do business.

HSBC, Standard Chartered Interested in FTZ

In a statement, Standard Chartered said it is committed to contributing to the further development of the Shanghai Free Trade Zone. HSBC spokesman Gareth Hewett, meanwhile, said the bank is interested in establishing a presence in the zone.

ANZ Banking economist Raymond Yeung told the South China Morning Post that the Free Trade Zone will surely benefit both HSBC and Standard Chartered because the zone will these foreign-invested banks to operate under a less-restricted market similar to what they experience in Hong Kong.

FTZ To Further Open China To The World

The Shanghai Free Trade Zone has been approved by the Chinese cabinet last month. It is China's first zone that occupies 29 square kilometers or 11 square miles in the progressive city of Shanghai. The Cabinet considers the zone as a crucial move by China in adapting to global economic, finance, and trade development.

Analysts said the Shanghai Free Trade Zone will further open up China to the rest of the world as it now welcomes foreign-invested firms to set up operations in Shanghai.