The Industrial and Commercial Bank of China (ICBC) has been granted a branch license to operate in the United Kingdom, the Prudential Regulatory Authority, the British financial services regulator, which is part of the Bank of England, said. ICBC has been authorized to operate in the United Kingdom as a wholesale-only branch. Prior to the announcement, ICBC was operating in the UK as a subsidiary, and had stricter capital requirements than those for a branch. With the new branch license, ICBC will now enjoy greater lending and financing capacity in the UK. Subsidiaries are subject to the strict capital requirements that apply to local banks in the UK. Hence, in most cases, their lending and financing capacity is proportional to the balance sheet of the subsidiary itself. Last year, the Bank of England said foreign banks would be allowed to apply for a branch license, although only for wholesale business. Retail business still needed to be conducted under a subsidiary license, in order to protect individual depositors. Before ICBC’s branch license, Bank of China (BOC) was the only Chinese bank to have a branch license in London, as its license was awarded before the regulations were tightened. Currently, Bank of China, ICBC and China Construction Bank Corp all have their European headquarters in Luxembourg, where they operate as branches.