Chinese search engine giant Baidu and China Citic Bank have received an approval from the regulatory authority to setup a joint venture bank in the country.

The new joint venture bank known as the Citic aiBank, was originally known as Citic Baixin Bank, when the venture was announced back in 2015.

In a stock exchange filing, Citic Bank revealed the approval for its operations from the China Banking Regulatory Commission.

The bank is expected to have a capital of 2bn yuan ($300m). A majority of stake (70%) in the joint venture will be owned by Citic Baixin Bank and the remaining 30% stake will be owned by Baidu.

The Citic aiBank’s operations will include deposits and loans from individuals, small and micro enterprises, bank card businesses, banassurance and interbank businesses.

The new bank will not run any physical branches, but will primarily offer its services through online banking.

China Citic Bank chairman Li Qingping has been appointed as the chairman of aiBank while, Citic Bank’s e-banking department former head Li Rudong will be its president.  

The name of the new bank reflects its goal to become a major player in the artificial intelligence (AI) sector, South China Morning Post reported.

Baidu said: “AI is the core element of the bank’s branding, and the bank will offer a spate of innovative services by riding on Baidu’s technology in AI and massive amounts of data.”

Baidu now joins the league of other Chinese technology giants including Alibaba Group and Tencent Holdings, which have already set up banking operations.