The office building of Morgan Stanley in Beijing Photo: VCG

US-based Morgan Stanley has set up a wholly owned futures company in Beijing, expanding its structure in China as the country further opens its financial sector to global players, domestic financial information provider Aiqicha revealed.

With registered capital of 1 billion yuan ($138.9 million), the new company opened for business on Thursday, another milestone in the opening-up and internationalization of the nation's financial sector, a Chinese expert said on Monday.

The China Securities Regulatory Commission (CSRC) on May 26 approved the establishment of the company, noting that it will support eligible overseas institutions to invest in futures business and to improve the futures market to serve the high-quality development of the real economy.

Morgan Stanley's new unit is the second wholly foreign-owned futures company in China and the nation's 151st futures venture, the Securities Daily reported.

In June 2020, the CSRC approved JPMorgan Chase's futures company as the first wholly foreign-owned one in China.

China's legal environment concerning futures and derivatives markets have improved in recent years, laying a foundation for attracting foreign investment, experts said.

China's first law on futures and derivatives took effect in August 2022. The law was expected to help build a more regulated and open capital market and serve the sustained development of the real economy, according to the Xinhua News Agency.

"The business environment of the financial industry has been improving and gradually reaching the global standard," Wang Peng, a research fellow at the Beijing Academy of Social Sciences, told the Global Times on Monday.

More global financial giants are expanding their presence in China, bringing more experience, capital and technology, which benefits China's financial industry and better serve the growth of the nation's real economy, Wang said.

Since Morgan Stanley entered China nearly 30 years ago, the company has kept expanding its business, including financing, restructuring, mergers and acquisitions advisory services and others, according to a statement the company released on July 6 when its wholly owned Morgan Stanley Bank International (China) was approved to open derivatives trading business in China.

China's derivatives market has grown swiftly in recent years and it is gaining momentum, the company said.

Fang Xinghai, deputy head of the CSRC, said during the 20th Shanghai Derivatives Market Forum in May that China will continue to expand the "width and depth" of the futures market's opening-up.

China's futures market maintained steady operations in 2022, with the trading volume of commodity futures and options accounting for 72.3 percent of the global total, said the China Futures Association.

Net profits of the country's 150 futures companies amounted to 10.99 billion yuan in 2022, data from the association showed in February.