Dong Le, an analyst from Guotai Junan Securities Co. Ltd., thinks in choosing CASA, CITIC values that company's business advantages, including its clients, development history and broad business coverage. Particularly, CLSA under CASA has the best independent research team and brokerage business in the Asia-Pacific Region, and Credit Agricole Indosuez Cheuvreux Securities Ltd. under CASA has a leading independent research team and brokerage team in Europe. Calyon Bank operates IPO-related businesses in the Asia-Pacific Region, Europe and the United States.

"CITIC's international business reaped profits of 181 million yuan ($26.5 million) in 2009, but contributed only 2 percent to the company's total net profits. Obviously, CITIC has more room to increase its profitability in the international market after the 'marriage' with CASA," Dong said.

CASA moves into China

Cooperation with CITIC will provide numerous opportunities for CASA to advance in the profitable Chinese capital market.

Before CITIC, CASA had contacted other Chinese financial institutions in search of a cooperative agreement.

In the Chinese mainland market, CLSA and Xiangcai Securities Co. Ltd. established China Euro Securities Ltd. in 2003, the first securities joint venture approved by China after its accession to the WTO. The venture's development was mediocre at best and, because of the financial difficulty facing Xiangcai, the Chinese stakes in the joint venture were transferred first to Hunan Valin Group and then to Fortune Securities Co. Ltd. Later, CLSA and Fortune Securities jointly established Fortune-CLSA Securities Ltd., with CLSA holding 33 percent of the shares. In 2008, Fortune-CLSA received qualifications for A-shares trading. The business is planning to commence operations in early 2011.

In August 2009, CLSA also established a private equity jointly with Shanghai Guosheng Group Co. Ltd., an operation platform for state-owned assets in Shanghai.

Moreover, in 2008, CASA, Agricultural Bank of China (ABC) and Aluminum Corp. of China jointly established an asset management corporation in Shanghai, with the three parties holding 33.33 percent, 51.67 percent and 15 percent of the shares, respectively.

At present, CASA is negotiating with ABC to purchase the latter's shares. As the only non-listed among the four biggest state-owned commercial banks in China, ABC is undertaking transformation toward a joint-stock bank and preparing for its IPO. If the negotiation is successful, CASA will be one of the shareholders of ABC.

During the global financial crisis, despite the heavy losses suffered by CASA, CLSA was affected little, which can be attributed to the resilience of the Chinese market. CASA has since attached great importance to its involvement in the Chinese market.

Projecting the cooperation between CITIC and CASA, both parties say they will seek further strategic cooperation in China, including offering cooperation opportunities and introducing businesses and clients to each other.

Parties in the Union

CITIC Securities Co. Ltd.

As the biggest securities company in China, CITIC Securities Co. Ltd. had total assets of 206.81 billion yuan ($30.29 billion) by December 31, 2009. At the end of 2009, it ranked first on the Chinese mainland in terms of brokerage business, stock underwriting and bonds underwriting.

Crédit Agricole S.A. (CASA)

Crédit Agricole S.A. (CASA) is the biggest banking group in France with its affiliates spreading across more than 60 countries and regions (mainly in the Middle East and Southeast Asia). It has 7,679 branches and serves 16 million clients. Besides providing basic commercial banking services, it also offers wide financial services and insurance products via its subsidiaries. On October 4, 1985, CASA established its representative office in Beijing.

Calyon Bank, headquartered in Paris, France, is part of CASA and now the biggest asset management corporation in Europe.

Credit Lyonnais Securities Asia (CLSA), headquartered in Hong Kong, is a CASA affiliate in the Asia-Pacific Region in the investment banking sector.