While some western banks have sold off Chinese financial assets because of the credit crunch, Bank of New York Mellon hopes soon to obtain regulatory approval for a fund management venture in China, Shanghai Securities News reported.

The planned venture with China's Western Securities, originally announced in November 2007, may win approval from Chinese regulators in the first half of this year, the US bank's Asia Pacific chairman, Christopher Sturdy, was quoted as saying.

Mr Sturdy did not specify the size and structure of the venture, but when Bank of New York first announced its plan in 2007, it said the venture would be owned 51 per cent by Western Securities and 49 per cent by Bank of New York.

The US bank also plans to cooperate with major Chinese financial institutions in areas such as dollar settlements and trade financing, Mr Sturdy was quoted as saying.

If BNY Mellon’s move goes ahead, it will show that some western banks are still keen to deepen business ties with Chinese counterparts. In recent months, a number of western banks, beset by heavy losses, have sold off stakes in Chinese banks. Sellers include UBS, Royal Bank of Scotland and Bank of America.