
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, October 19, 1994                   TAG: 9410190042
SECTION: BUSINESS                    PAGE: B-8   EDITION: METRO 
SOURCE: MAG POFF STAFF WRITER
DATELINE:                                 LENGTH: Medium

FIRST UNION, ASIA BANK IN TRADE VENTURE

First Union Corp. has formed a joint venture with Hongkong Chinese Bank Ltd. to support trade in Asia by United States companies.

The transaction, which was consummated Tuesday in Hong Kong, establishes a relationship expected to provide First Union customers with proven expertise in Asian markets.

First Union, parent of Roanoke-based First Union National Bank of Virginia, and the Hongkong Chinese Bank will jointly own a deposit-taking company, First Union HKCB Asia Ltd., which will provide trade-finance products and services to importers and exporters in the United States, China and Hong Kong. The joint venture is expected to generate $1 billion annually in trade transactions within five years.

The Hongkong Chinese Bank specializes in trade finance, with 65 percent of its loans devoted to local companies engaged in import or export activity.

The bank is a commercial banking subsidiary in Hong Kong of the Lippo Group, a diversified holding company that operates banks and insurance, property and manufacturing companies throughout Southeast Asia. The Lippo Group is based in Jakarta, Indonesia, where it controls the fifth largest privately owned commercial bank, Lippobank.

The Hongkong Chinese Bank is half owned by China Resources (Holdings) Co. Ltd., the largest mainland Chinese trading company incorporated in Hong Kong. China Resources was established in 1948 by the government of China and now operates 200 companies in Hong Kong.

By establishing the relationship with the Lippo Group and China Resources, First Union will be able to take advantage of the flow of trade with mainland China and the region, the company said.

Worldwide, First Union's annual trade finance volume has tripled during the last three years and is expected to reach $4 billion by the end of the year. This includes a presence in Latin America, where First Union will finance approximately $1.6 billion in trade transactions this year.

Tuesday's announcement was the second major development in First Union's international operations in the past two weeks. First Union signed an agreement Oct. 5 with a South African bank and the Export-Import Bank of the United States to facilitate trade in South Africa.

by CNB