China market round-up: Eastspring obtains PFM license, SWIFT publishes report for Sibos, ICBC to set up Austria branch
In this round up, Eastspring Investment Management can now offer onshore investment products to Chinese customers, SWIFT Business Intelligence outlines Australia’s role in renminbi internationalisation, and Industrial Commercial Bank of China (ICBC) gets approval from the European central Bank to set up a subsidiary in Austria.
Eastspring Investment Management (Shanghai), the Chinese investment management arm of Prudential, has successfully registered as a private fund manager (PFM) license with the Asset Management Association of China, according to a Tuesday press release.
The license will enable the company to offer onshore investment products to high-net-worth individuals and institutional investors in China. The parent firm, Pfrudential Corporation Asia, is anticipating its China’s asset under management (AUM) to triple by 2025 to $12.6tr.
“Our ambitions in China are to serve local Chinese investors, offer Chinese investors the opportunity to invest in Eastspring’s global offshore funds, and also provide global investors with the opportunity to invest directly in China via our onshore investment team,” Guy Strapp, chief executive at Eastspring, said in the press release.
The firm also hired a new chief innovation officer to aid in its expansion onshore. Michelle Qi, former chief investment officer for QFII and QDII at the Bank of Communications Schroder Fund Management, took up the role.
Based in Shanghai, Qi will report jointly to Virginie Maisonneuve, chief investment officer and Michael Lu, general manager for China region.
Qi will be responsible for the growth and development of Eastspring’s onshore equities investment offering in China.
Payment infrastructure provider Swift published its monthly report on RMB payments on October 23.
In September 2018, renminbi accounted for 1.89% of the total value of institutional and commercial payments, ranking fifth as an international payment currency. The report also highlighted the two-way trade relationship between Australia and China.
Trade volume reached $125bn in FY2016/17, accounting for almost a quarter of total trade volumes in Australia, according to the report.
The trade relationship between the two countries is also reflected in the keen RMB internationalisation efforts in Australia, the report shows. Although the Australian dollar is still the main currency used for payments between Australia and China or Hong Kong, renminbi payments are growing, now accounting for 13.89% of total payments.
The report introduced two existing models that facilitate renminbi payments - Sydney’s RMB offshore centre and the Austraclear RMB platform serviced by ASX.
The RMB offshore centre in Sydney was launched in 2015 and is the eighth largest globally in size, accounting for 1.08% of all global renminbi offshore flows.
ASX RMB Settlement Service allows payments that are initiated within the country to be settled domestically. Over Rmb6bn has been settled through the ASX RMB Settlement Service in fiscal year 2018. Thanks to the settlement service, the total number of transactions settled in RMB is four times what was settled in the year before.
Industrial and Commercial Bank of China (ICBC) received approval from the European central Bank (ECB) to set up a subsidiary in Austria, according to an October 24 statement from the bank.
The establishment aims at improving the presence of ICBC in the European market as well as in the Central and Eastern Europe network and enhancing the capabilities in cross-border financial services.
According to the statement, China is Austria’s largest trading partner in Asia and the fifth largest trading partner in the world.
Trade volume between the two countries in 2017 amounted to $8.39bn, an increase of 15.5% YoY, according to the statement. The establishment of ICBC Austria aims to further strengthen cooperation with the Austria government in infrastructure construction.
Ping An-UOB China fund has had an ownership change. Ping An Trust increased holdings by 7.5% to 68.2% and UOB Asset Management decreased holdings by 7.5% to 17.51%, according to a statement filed by China Securities Regulatory Commission on October 16.
The story has been updated on October 29 to correct the last name of Eastspring's new chief innovation officer, Michelle Qi.