Foreign banks in China face new challenges, survey shows

Foreign banks are facing new challenges operating in China following the global economic crisis. Domestic lenders, which in the past have had little advantage over their foreign peers in terms of banking services and products, have turned into formidable competitors, a new survey shows.

Increasing competition from domestic lenders, with their extensive branch networks and rising service expertise, was marked as the top challenge -- a box usually reserved for the regulatory environment or finding and retaining good personnel, PricewaterhouseCoopers found in its fifth annual survey on foreign banks in China.

The firm interviewed CEOs and senior management at 42 foreign banks in Beijing, Shanghai, Shenzhen and Hong Kong. The respondents think...