Hang Sheng Bank plans to increase its outlets on the Chinese mainland to 30 by the end of next year and to more than 50 by 2010, joining an expansion spree by overseas lenders, a senior executive said.

"We plan to invest more than HK$1 billion (US$128 million) to expand our mainland network and service capacities by the end of 2008," Chief Executive Raymond Or said. The Hong Kong banking giant has also submitted its application to incorporate on the mainland, and if this goes smoothly, "we will set up a mainland subsidiary bank headquartered in Shanghai in the first half of 2007."

Hang Sheng Bank currently has 15 branches, sub-branches and representative offices on the mainland, fewer than rivals such as HSBC and Bank of East Asia. The bank has so far invested more than 3.8 billion yuan (US$487 million) in the mainland. In September, the bank had a board meeting in Shanghai, the first time it held such an important gathering on the mainland. Like most overseas lenders, Hang Seng Bank will focus on the high-end market.

That is also why the branches to be opened will mainly be located in the Pearl River Delta and Yangtze River Delta, two major economic engines and the mainland's most affluent areas, Or said. New outlets will also be opened in major cities such as Shanghai, Beijing, Guangzhou and Shenzhen.

Hang Sheng's plan is in line with the situation on the mainland, where domestic banks dominate the mass market with a huge spread of networks while overseas banks attract high-end corporate and individual clients with their management and experience. But compared with home rivals, "Hang Seng has to catch up in the mainland play.

Hang Sheng Bank also plans to boost its mainland workforce. The lender, which currently has 550 mainland staff, will increase that number to more than 1,000 by the end of next year and over 2,000 by 2010.