Shanghai, December 8:

China’s banking industry officially opens to full foreign competition on Monday, a landmark for the country’s financial sector and a day of reckoning for the country’s mostly state-owned banks.

The world’s biggest banks — Citigroup Inc, HSBC Plc and Bank of America among them — have spent billions of dollars and devoted huge resources to positioning themselves for this moment.

The change, agreed to under conditions set when China joined the WTO in 2001, is the closest China, whose financial markets remain tightly regulated in many areas, has come so far to a “Big Bang” along the lines of the unprecedented 1986 overhaul of London’s financial world. But as avid as global banks may be to tap China’s 31.5 trillion yuan ($4 trillion; euro3 trillion) pool of household and commercial wealth and its fast-growing market for financial services, they are unlikely to win a major share of the industry anytime soon, analysts say.

“It is really difficult for foreign banks organically to grow, particularly in as large and idiosyncratic a market as China,” says Michael Pettis, a professor of finance at Peking University’s Guanghua School of Management.