Citibank, Grameen join China's rural banking pilot

BEIJING, Oct 23 (Reuters) - Citibank, a unit of Citigroup (C.N), and Grameen Trust are following HSBC to take part in a Chinese pilot programme for expanding financial services in the countryside, the banking regulator said on Tuesday.

Zang Jingfan, a senior official with the China Banking Regulatory Commission, told a news conference the U.S. bank was preparing to set up a lending firm in China. He also said the Bangladesh-based microcredit trust would lend technical support to new rural banks in China. He did not elaborate.

China launched a trial scheme in the first quarter of this year in six provinces, making it easier for commercial banks to offer their services in rural areas. It expanded the programme nationwide earlier this month.

Zang said a total of 23 new rural financial entities had been launched under the scheme. Another three had received regulatory approval, while five more were still waiting for the CBRC's nod.

HSBC (0005.HK)(HSBA.L) in August became the first foreign bank to get regulatory approval to open a village bank, in the central province of Hubei. It is expected to begin operating by the end of the year.