Bank of Nova Scotia, the Canadian bank, has received approval from Chinese authorities to create a joint venture fund management company with Bank of Beijing.

Bank of Beijing Scotiabank Asset Management, the new firm, will be 33 per cent owned by Scotiabank and 62 per cent owned by Bank of Beijing. The rest of the 5 per cent will be held by General Research Institute for Nonferrous Metals, a Beijing-based research and development institution.

The licence is the first under a new round of pilot programs by the Chinese government, which allows international banks to operate locally through partnerships with Chinese financial institutions. 

Scotiabank has a considerable presence in China, having opened its first representative branch in 1982 and growing since to have branches in Guangzhou, Chongqing and Shanghai. It also has branches in Hong Kong and Taipei. Beyond Bank of Beijing, it holds a 19 per cent stake in Bank of Xi'an and is working to complete its acquisition on a 19.99 per cent interest in Bank of Guangzhou.