BEIJING Jan. 15 -- Foreign banks are seeking opportunities through China's financial reform, according to a survey by PricewaterhouseCoopers(PwC).

Ambitious reforms were announced late last year, including interest rate liberalization and yuan internationalization; challenging but laden with opportunities for commercial banks.

"China's macroeconomy dramatically changed in 2013. Future policy and regulatory changes, such as RMB internationalization and interest rate liberalization, will have a dramatic impact on the strategies of foreign banks," remarked one foreign banker in the survey.

Despite numerous wholly-owned subsidiaries of foreign banks taking root in China in recent years, they have made little impression on the dominance of Chinese banks, taking only an insignificant market share from such large competitors like the Industrial and Commercial Bank of China.

The reform agenda provoked renewed enthusiasm for foreign banks generally believed to have better quality control and risk management.

Foreign banks will benefit from interest rate liberalization in several ways, the survey found. It plays to their strengths in pricing and liquidity risk, allows them to use interest rate risk management products.

The internationalization of yuan is another growth opportunity. Foreign companies increasingly use yuan for trade settlement and invest what they receive, according to the survey.

The survey, based on face-to-face interviews with 37 CEOs and senior executives of foreign banks in China, is the eighth of its kind since 2005.

A number of banks in the survey expressed their desire to create more distinctive products, either through attributes or pricing, that provide unique market opportunities. Many also discussed plans to develop more fee-based business, particularly in wealth and cash management.

While foreign bank CEOs are broadly optimistic, they remain circumspect about how policy and regulations will apply to their banks, fearing constraints similar to those of the past, such as lengthy approval processes.

Seen as broadly positive through the eyes of foreign bank executives, the Shanghai pilot free trade zone has already significantly relaxed off-shore RMB exchange, remittance and settlement, and lifted trade restrictions for banks in the zone. The Bank of East Asia China became the first to officially open a sub branch in the zone last week, while HSBC China said it would do so very soon.

"Foreign banks with commitment to bold decisions and investment - as well as a board and management with the stomach to endure what will likely be a fair level of uncertainty and volatility - will be well positioned for China's opening economy and financial markets," said PwC China Banking and Capital Markets Leader Jimmy Leung.

"Those who miss this window of opportunity may not be able to catch up later," he added.