BlackRock Gets Green Light to Start Offering Mutual Funds in China
June 11 2021 - 2:13AM
Dow Jones News
By Quentin Webb
BlackRock Inc. won approval from Chinese regulators to begin
operations at its wholly owned mutual-fund business in the country,
paving the way for the New York-based asset manager to start
selling funds to individual investors in China before the end of
this year.
The go-ahead is the latest in a series of steps taken by China
to allow U.S. banks and investment firms, such as JPMorgan Chase
& Co. and Goldman Sachs Group Inc., greater access to its
markets following last year's trade accord between Washington and
Beijing.
BlackRock, the world's largest money manager with $9 trillion in
assets under management as of end-March, has made expansion in
China a priority. It secured a nod from the China Securities
Regulatory Commission last August to establish the mutual-fund
business, which is now permitted to begin selling funds.
"We look forward to sharing our global investment expertise and
offering more differentiated investment solutions to Chinese
investors," BlackRock Chairman and Chief Executive Larry Fink said
in a statement Friday.
The U.S. giant is among the first foreign firms to reach this
milestone. Other global investment houses that are also setting up
wholly owned mutual-fund units in China include Fidelity
International and the asset-management arm of JPMorgan.
BlackRock's Shanghai-based unit, BlackRock Fund Management Co.,
now has six months to launch its maiden fund for individual
investors, a spokeswoman said. This and future funds are likely to
be sold through traditional mutual-fund distribution channels in
China, which include banks and brokerages, she added.
Rachel Lord, BlackRock's chair and head of Asia Pacific, told an
investor day on Thursday that the broader asset-management business
would benefit from China opening up to foreign players. "It's quite
clear that the opportunity onshore in China to participate in this
opening up is very, very large for the entire industry," she said,
according to a transcript. "And we do expect to take a
market-leading position over the course of the next decade."
Last month, BlackRock was permitted by China's banking regulator
to pursue an onshore joint venture in wealth management together
with a unit of state-owned China Construction Bank and Singapore
state investment company Temasek. Wealth-management businesses in
China also typically sell investment products to individuals.
In another recent approval, Chinese regulators in May gave their
consent to a wealth-management joint venture between Goldman Sachs
and Industrial & Commercial Bank of China Ltd.
--Dawn Lim contributed to this article.
Write to Quentin Webb at quentin.webb@wsj.com
(END) Dow Jones Newswires
June 11, 2021 02:00 ET (06:00 GMT)
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