Caixin
Nov 21, 2022 09:17 PM
FINANCE

Canada’s Manulife Approved to Take Full Control of Its China Mutual Fund Venture

The Manulife Financial Centre in Hong Kong. Photo: Courtesy of Manulife
The Manulife Financial Centre in Hong Kong. Photo: Courtesy of Manulife

Canadian insurance giant Manulife Financial Corp. has won approval to become the fourth foreign company to operate a wholly owned mutual fund business in China.

The Toronto-based financial firm, which controls 49% of Beijing-based mutual fund joint venture Manulife Teda Fund Management Co. Ltd., has been allowed to acquire the remaining 51% stake from its Chinese partner, according to a notice released by the China Securities Regulation Commission on Friday.

Two Manulife units — Manulife Investment Management (Hong Kong) Ltd. and Manulife Investment Management (Singapore) Pte. Ltd. — will hold 49% and 51% of Manulife Teda, respectively, after some paperwork goes through.

 Read more  
In Depth: China’s Plan to Overhaul Its $3.7 Trillion Mutual Fund Industry

Beijing scrapped the limit on foreign ownership of mutual fund businesses in April 2020, allowing overseas firms to take a full stake in a local mutual fund company, as part of a broader opening-up of financial markets.

China’s multitrillion-dollar wealth management industry attracts foreign financial institutions, but only a handful of them have been given the nod to run a wholly owned mutual fund business in the country, including global financial titans BlackRock Inc., Fidelity International, and Neuberger Berman Group LLC. The sector remains dominated by Chinese firms.

Another four foreign companies are awaiting regulatory approval to launch or control a wholly owned mutual fund company in the country. They are U.S.-based JPMorgan Chase & Co., Van Eck Associates Corp., AllianceBernstein LP, and U.K.-headquartered Schroders PLC.

In recent years, China has witnessed a boom in the mutual fund market amid a rapidly growing middle class. As of September, 154 industry players collectively managed 26.6 trillion yuan ($3.7 trillion) of assets through 10,263 funds, data from the Asset Management Association of China showed. The amount nearly doubled within three years.

Manulife Teda ranked around 70th with 62.8 billion yuan of assets under management in September, according to data compiled by Shanghai Tiantian Fund Distribution Co. Ltd.

Contact reporter Zhang Ziyu (ziyuzhang@caixin.com) and editor Bertrand Teo (bertrandteo@caixin.com)

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