Nordea in Shanghai: A one-stop shop for Nordic companies in China

When it comes to doing business in China, securing access to local funding can be a major challenge, particularly for small and mid-sized companies. A Nordic-based company may need to build a factory or buy new machinery for its operations in China. Yet local Chinese banks are seldom willing to lend money to a foreign company they do not know.

That’s where Nordea’s Shanghai branch can help fill the gap.

“Because we know these companies, or their Nordic parent company, we can help give them the financial support they cannot get from the local market,” says the branch’s general manager, Angela Tu.

The branch recently hit a major milestone, connecting to China’s payment infrastructure (CNAPS) as well as implementing Netbank International, the electronic banking service offered to customers. The new infrastructure means that the branch can now offer end-to-end banking services to customers in China, covering not only financing but also daily banking needs, such as incoming and outgoing payments in all currencies.

“With the connection to CNAPS and the integration to NBI, we can now support our customers with a full-suite product offering and expanded cash management capabilities.” Angela says.

Bridging the cultural divide

Nordea’s Shanghai branch dates back to 2008, with deep roots in the Chinese market. A highly qualified and experienced staff provide unique insight and understanding of the Chinese framework, local market practices and regulations in the Chinese banking industry. The strong link to the Nordics and cross-cultural mix of staff also helps bridge any cultural or language barriers that can come up when trying to finance operations in China.

That could be when obtaining a fixed asset loan for building a new plant or buying new machinery or setting up a credit facility to cover working capital needs.

“We’re also doing more and more trade finance for companies,” Angela says. “It’s a good mix. Many customers also choose to do FX and place deposits with us rather than with Chinese banks. At Nordea, they get a dedicated client executive and customer service team to help them on a daily basis.”

Navigating local regulations

Customers come with many different types of questions, from taxes, employee compensation, dividends, transfer pricing and how to finance a subsidiary to setting up the optimal capital structure. As China is not a free market in the financial sector, there are a lot regulatory requirements, especially related to FX.

“Newcomers and other customers often find it very helpful to learn and understand the local market from a Chinese angle. We provide that local perspective and can help explain the relevant local policies and regulations,” says Angela.

Nordea is one of the few Nordic banks with a physical presence in China, after the exit of several peers from the market in recent years. We continue to invest in our future in China, with our newly developed infrastructure and expanded product offering. The Shanghai branch is closely integrated with the rest of the Nordea Group, with the goal of being the leading bank for Nordic corporates doing business in China.