SHANGHAI – BlackRock has become the first global asset manager allowed to start a wholly owned onshore mutual fund business in China, as Beijing accelerates opening of the fast-growing US$3.5 trillion (S$4.6 trillion) wealth industry.
BlackRock said on Friday (June 11) its Chinese fund management unit had won approval from the China Securities Regulatory Commission to start the operation.
“China is taking significant steps in opening up its financial markets,” BlackRock chairman and chief executive officer Larry Fink said in a statement.
“We look forward to sharing our global investment expertise and offering more differentiated investment solutions to Chinese investors.”
China scrapped foreign ownership caps in its mutual fund and securities sectors last April as part of an interim Sino-United States trade deal.
Several other global asset managers, including Fidelity International, Neuberger Berman and Schroders, have also applied to set up wholly owned mutual fund businesses in China.
BlackRock’s announcement came a month after it was given the nod to pursue a joint venture asset management business along with China Construction Bank and Singapore investment company Temasek.
Together, the two entities give BlackRock an edge to reach more investors in China, as it competes with a slew of global institutions going after an asset pool estimated by Goldman Sachs Group to surpass US$70 trillion by the end of this decade.
BlackRock said on Friday the regulatory approvals position it to extend the breadth of its products and services, and investment insights, to all client segments across China.
“Rapid economic development and wealth accumulation in the world’s second largest economy have propelled growth of the domestic asset management industry,” Ms Susan Chan, BlackRock’s head of Asia, said in the statement.
She added that BlackRock is eager to play its part “in helping to make investing easier and more affordable” in China.