China asset management Archives - International Finance

AGF Management and WafeFront Global launch asset management JV

Pritam Bordoloi — Wed, 23 Sep 2020 08:43:34 +0000

AGF Management and WaveFront Global Asset Management have announced the launch of a new joint venture called AGFWave Asset Management, media report said.

AGFWave will provide its asset management services and products in China and South Korea.

According to Wealth-X report, China witnessed a 20 percent jump in its billionaires headcount in 2019.

Kevin McCreadie, who serves as the chief executive officer as well as the chief investment officer at AGF, told the media, “Combining AGF’s investment capabilities with the robust distribution channels and sales capabilities of WaveFront’s strategic partners Hwabao WP Fund Management, J Royal Asset Management and Vogo Fund Asset Management mean AGFWave is well positioned to capitalise on the rapidly growing asset management industries in China and South Korea.”

The joint venture will see members of AGF’s quantitative investment team AGFiQ work with members of WaveFront’s team as AGFWave’s Investment Committee.

AGFWave will also be responsible for new product development in China and South Korea. The joint venture will work closely with its partners in these regions and explore future opportunities to bring AGF’s other quantitative and complementary fundamental investment management capabilities to these rapidly growing markets.

Roland Austrup, chairman and managing principals at WaveFront told the media, “We are very excited about the opportunity to partner with AGF and believe their unparalleled investment management expertise will not only lead to stronger demand for our current products, but enable us to develop and launch new products in key areas our partners and clients are eager to access.”

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Blackrock, Temasek to establish China asset management JV

International Finance Desk — Fri, 20 Dec 2019 07:55:29 +0000

BlackRock and Temasek have entered a non-binding agreement to establish an asset management business in China, the local media reported. China Construction Bank’s asset management arm will also participate in the collaboration.

China Construction Bank is one of the big four banks in the People’s Republic of China. Under the terms of the agreement, BlackRock and Temasek will create and distribute development products for the Chinese market.

The deal is subject to regulatory approval. The US firms including BlackRock are facing challenges despite China’s financial openness. Currently, there are other foreign firms seeking to establish joint ventures and explore China’s market.

The regulatory changes in China allows foreign firms to have 51 percent of a wealth management joint venture with a bank. Companies including UBS, JPMorgan and Nomura have received regulatory approval for acquiring majority control of their local securities joint ventures, Bloomberg reported.

BlackRock Chief Executive Larry Fink said the company seeks to be one of China’s top asset managers. The company perceives China to be one of its greatest platforms for growth.

In 2018 end, nearly seven percent of BlackRock’s assets under management came from the Asia-Pacific region. Its efforts to expand into China has led to early talks with Chinese multinational Tenancent to further tap into the investment market with a diverse portfolio.

Temasek is the world’s largest asset manager and Singapore’s state investor. Earlier this month, Temasek startup fund raised $70 million from Japan’s Marubeni and Sumitomo Mitsui Banking Corporation (SMBC) to invest in AI ventures in India and China.

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JP Morgan first foreign firm to take control of China fund

International Finance Desk — Thu, 08 Aug 2019 08:30:41 +0000

JP Morgan revealed that it had won an auction to acquire an additional 2 percent stake in China International Fund Management from its Chinese partner, Shanghai International. It is also set to become the first foreign firm to own a majority stake in an onshore funds business under new rules.

The bank paid $34.3 million for the additional 2 percent which will take its stake up to 51 percent.

Prior to the deal, JP Morgan held a 49 percent stake in China International Fund Management, a joint venture between the bank and its local partner.

Under these new rules regulated by China in 2017, financial asset management companies were allowed to own up to 51 percent of their Chinese mutual fund ventures.

“We are looking forward to the next steps to proceed with this acquisition, working closely with our joint venture partners. Once completed, the deal will be contingent on the approval of regulators in the US and China,” Dan Watkins, Asia Pacific CEO of JP Morgan Asset Management told the media.

Besides acquiring a majority stake in a Chinese fund, JPMorgan is also planning to set up a new securities company in Shanghai with a 51 percent stake. The bank will collaborate with Chinese partners including Shanghai Waigaoqiao Free Trade Zone Group and four other Chinese investment companies.

Another US firm Morgan Stanley is also inching closer to gain a controlling stake in its Chinese securities joint venture by acquiring an additional 2 percent stake from partner Huaxin Securities. The deal will also increase Morgan Stanley’s stake in Morgan Stanley Huaxin Securities to 51 percent.

According to reports, 1.4 billion Chinese citizens had investible financial assets of $20 trillion in 2018. The figure is only expected to increase to $26 trillion by the end of 2020.

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With fast growth, global asset management firms shift focus to Asia

International Finance Desk — Tue, 02 Jul 2019 05:01:33 +0000

Asset management in Asia is growing rapidly and it is attracting asset managers from all around the globe.
According to the Financial Times, Asian asset management activities broke various records in 2018, overtaking matured markets such as the US and Europe in various aspects.
Asset management profits in Asia jumped by 200 percent to about $32 billion between 2007 and 2018, according to the report.
During the same period, US profits increased by 48 percent to $43 billion whereas European profits increased by 42 percent to $20 billion.
According to a McKinsey report, asset management revenues in Asia will reach $112 billion in the next five years.
Chinese assets managed by financial institutions are expected to reach an estimated $7.5 trillion by 2022, according to global management consulting firm Oliver Wyman.
“China receives a lot of attention but there are smaller markets in southeast Asia that also present important longer-term growth opportunities. Deep revenue pools exist in the more mature Australian and Japanese markets, where regulatory changes and shifts in client needs mean there is still strong growth potential,” Geraldine Buckingham, head of Asia Pacific at Blackrock told the Financial Times.
JP Morgan Asset Management is building its asset management business in China with the next 100 years in mind. With the changing structure of the financial market in China, JP Morgan expects clients to seek internationally diversified, long-term strategies.
JP Morgan Asset Management is also looking to expand in Asian countries such as Hong Kong, Japan, Taiwan, Australia, and Korea. At the rate at which Asian asset management market is growing, it is only expected to bring in a new portfolio of investors.

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