This Case is about STRATEGY
PUBLICATION DATE: November 15, 2008 PRODUCT #: BH302-HCB-ENG
China has restricted a good deal of interest from almost all U.S. business sectors. The Chinese credit card market is currently especially intriguing for Western banks. This post analyzes the minefield that is tactical as they try to compete in the Chinese credit card business that Western banks must browse. For instance, Bank of America (BOA)-fresh from buying a 9% interest in China Construction Bank (CCB) a few years ago-is currently considering a joint venture with CCB. The analysis gives several lessons that are tactical, and supports warning on the part of Western bank executives as they enter the Chinese marketplace. In particular, BOA officials must value the time of the development of their joint venture. Also, monetary endeavors should be strongly considered by BOA officials besides credit, as Chinese culture should prove especially immune to functioning as a lucrative customer base in the brief- and middle-timeframes.