Article at a glance:

Nudging open China's retail banks

Under China's uncertain regulatory environment, retail banking may never become an entirely level playing field. Our research suggests, however, that outsiders could make a stronger start if they first compete in the wholesale-banking market, which is expected to open up to foreign competition between 2004 and 2007. The experience will allow them to build up their skills, acquire market knowledge, and accumulate cash reserves while learning to cope with China's fast-changing regulations.

The take-away