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Baidu, CITIC to jointly set up online bank

Xinhua, November 18, 2015 Adjust font size:

China's search engine giant Baidu and financial service company CITIC Group announced Wednesday they would open an online bank.

Baixin Bank, a direct sales bank providing online financial services, will be China's first venture between an Internet company and a traditional bank.

The new bank's registered capital will be 2 billion yuan (313.5 million U.S. dollars). CITIC Bank, a subsidiary of CITIC group, will be the controlling shareholder, according its statement.

Li Qingping, head of CITIC Bank, said the new bank will be supported by both companies, but its operations will be fully open to the market without intervention from CITIC Group or Baidu.

"Baixin Bank marks a leap of Baidu's financial services and a milestone of China's Internet finance," Baidu CEO Li Yanhong said.

Baidu dominates search engines in China, and has been diversifying its businesses, which include an online payment platform, video-hosting site, food delivery and group coupon buying.

China's other two Internet giants Alibaba and Tencent have already secured banking licenses and started to explore the banking sector.

Tencent launched its online bank, WeBank, in January, and holds a 30 percent stake. Alibaba owns 30 percent of MYbank, which opened in June, through Ant Financial.

Shares of CITIC Bank surged 9.27 percent in the benchmark Shanghai Composite Index on Wednesday. Endi