BEIJING/HONG KONG (Reuters) – Morgan Stanley (MS.N) has received regulatory approval to take a majority stake in its China securities joint venture, three people with direct knowledge of the matter said, as Beijing continues to open its financial sector to foreigners.

FILE PHOTO: A sign is displayed on the Morgan Stanley building in New York U.S., July 16, 2018. REUTERS/Lucas Jackson/File Photo

The approval comes as policymakers and authorities step up efforts to shield the world’s second-largest economy, battered by the coronavirus pandemic.

The Wall Street lender received the nod from the China Securities Regulatory Commission to raise its stake in Morgan Stanley Huaxin Securities to 51%, the people said, declining to be named as they were not authorized to speak to the media.

A spokesman for Morgan Stanley in Hong Kong declined to comment.

Majority ownership of the joint venture would potentially allow the U.S. bank to expand operations in China, and better integrate them with its global businesses.

Morgan Stanley Huaxin Securities’ existing operations include underwriting and sponsoring equity and debt offerings as well as proprietary trading of bonds, it says on its website.

China raised the cap on foreign ownership of securities operations to 51% in 2018. Until then international banks had been allowed only minority stakes in their Chinese joint ventures.

Swiss lender UBS (UBSG.S) became the first foreign bank to hold a majority stake in a China securities business under the new rules in 2018. Japanese brokerage Nomura Holdings (8604.T) and JPMorgan (JPM.N) got their approvals last year.

Credit Suisse (CSGN.S) and Goldman Sachs (GS.N) are still awaiting approvals after they submitted applications for majority-controlled securities JVs.

Beijing promised to scrap foreign ownership caps on securities firms and mutual funds for foreign investors from April 1, in an interim Sino-U.S. trade deal signed in January.

The Morgan Stanley approval comes a day before China temporarily bars entry for most foreigners as an interim measure in response to the coronavirus epidemic.

Market participants said the thumbs up was a sign the country is continuing with the formal opening up of financial markets, despite the virus.

Last Friday, Shanghai said some of the world’s top financial institutions, including BlackRock and JPMorgan, were stepping up investments in China’s financial hub, undeterred by the pandemic.

Reporting by Zhang Yan in Beijing and Julie Zhu in Hong Kong; Additional reporting by Alun John in Hong Kong; Editing by Edmund Blair and Clarence Fernandez

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