Xinjiang Hualing Commerce, Industry and Trade (Group) Co told the Global Times Wednesday that the private trading firm has bought 90 percent of Georgian JSC Basisbank for $100 million so as to provide financial support to Chinese companies operating in the West Asian country.

"Georgia has talked to Hualing several times to set up a bank in the country as the bilateral trade between China and Georgia has increased in recent years, but there were no banks in Georgia with Chinese background," an anonymous employee at Hualing Group's office told the Global Times Wednesday.

Hualing, based in Northwest China's Xinjiang Uyghur Autonomous Region, was chosen by Georgia's central bank to acquire Basisbank due to the company's rich trade experience with Georgia, the employee said.

Hualing is the first Chinese private enterprise to acquire a foreign commercial bank, the Xinhua News Agency said on Wednesday.

The bank will change its name to Hualing Bank after the equity transfer and will operate in Tbilisi, capital of Georgia, and Kutaisi, the country's second largest city, Xinhua reported.

With a large number of clients in Georgia, Hualing would facilitate cross-border yuan trade settlement so that the companies can save foreign exchange costs by settling deals in the yuan rather than the US dollar, Luo Yuding, deputy dean of the School of Business at Shanghai University of Finance and Economics, told the Global Times Wednesday.

"However, trading in the yuan is not widely accepted in countries in Central and West Asia, so it is still difficult to push it forward by just acquiring a local bank," Luo noted.

Moreover, while Hualing has trade links with Georgia, it lacks experience in running banks, he said.

The acquisition involves big risks in terms of cross-cultural management and local policies, Liu Shengjun, deputy director of the CEIBS Lujiazui International Finance Research Center, told the Global Times.

The acquired bank is relatively small in scale, which would also make it difficult for Hualing to earn profits from the bank, Liu said.

Basisbank is the 11th largest among Georgia's 19 commercial banks by assets, with a value of 154 million Georgian laris ($94 million) at the end of March.

Hualing is one of the biggest Chinese companies operating in Georgia, with an investment of over $100 million in lumber, mining and trade.

After the acquisition, Hualing would further invest in Georgia in an economic zone to be set up in Tbilisi on Saturday, engaging in trade, processing as well as tourism, the employee at Hualing said.

The bilateral trade between China and Georgia increased 18.4 percent to $174 million in the first four months of this year, accounting for 5.6 percent of Georgia's foreign trade. China is the fifth largest trade partner of Georgia.