HSBC, Europe's largest bank, plans to open more outlets in China in the years ahead now that its banking sector is fully opened.

The bank rolled out a new branch in Xi'an, capital of Northwest China's Shaanxi Province, on Friday, becoming the first foreign bank to expand its presence in western China.

"We are pleased to extend our network in western China and support the 'go-west' campaign with our international banking services," said Richard Yorke, chief executive officer of HSBC China.

The Xi'an branch, Yorke said, will strengthen his bank's position to meet the growing demand for international banking services in this regional economic centre.

HSBC, which opened a sub-branch in Guangzhou earlier this month, now has expanded its outlets to 29 including 14 branches and 15 sub-branches, making it the largest presence of any foreign bank in China.

"We will continually expand our network on the Chinese mainland in the coming years," Yorke said at a press briefing.

HSBC is planning to open more outlets in the country next year, he said, but declined to reveal specific figures, saying it would depend on regulatory approval and the bank's "own ability to hire adequate people to manage them."

The opening of the Xi'an branch also made HSBC the second foreign bank to set up shop in the province after Hong Kong's Bank of East Asia.

In a bid to support the go-west strategy, the China Banking Regulatory Commission said that it had set up "a speedy and simplified" approval mechanism for foreign banks applying to expand to western China as a measure of encouragement.

The commission also said it is "studying and considering the idea of granting much more preferential policies for foreign banks to conduct local currency business in western China.

The statement did not elaborate.

HSBC, which owns 19.9 per cent of China's fifth-largest lender, the Bank of Communications, already has two branches in western China, one in Southwest China's Chongqing and the other in Chengdu, capital of Sichuan Province.