Foreign financial institutions continue being bullish on Chinese market

Abstract : Recently, with the approval of the establishment of Alliance Bernstein Fund Management Co., Ltd. by relevant Chinese authorities, the number of wholly owned foreign public offering fund companies increases to eight in the Chinese market, and the launch of foreign public offering products has also been accelerated.

People enjoy the view of Lujiazui at the Bund in east China's Shanghai, Aug. 2, 2019. (Xinhua/Chen Fei)

BEIJING, March 16 (Xinhua) -- Recently, with the approval of the establishment of Alliance Bernstein Fund Management Co., Ltd. by relevant Chinese authorities, the number of wholly owned foreign public offering fund companies increases to eight in the Chinese market, and the launch of foreign public offering products has also been accelerated.

Industry insiders hold that with the continuous implementation of China's financial opening-up policy and the steady recovery of China's economy, many foreign institutions have confidence in the Chinese market, believing that the Chinese market has huge investment potential and accelerating their efforts to seize the opportunities of the Chinese market.

-- Accelerated layout of foreign public offering products

China Securities Regulatory Commission (CSRC) approved the establishment of Alliance Bernstein Fund Management Co., Ltd. on March 3 this year, making it the fourth wholly owned foreign public offering fund company approved and ratified by the CSRC in 2023. Up to now, there are eight wholly owned foreign public offering fund companies in China.

Meanwhile, the foreign public offering products are also increasing.

On February 27, Neuberger Berman Fund issued its first public offering fund product in the third month after being approved for starting business.

On March 3, Fidelity Fund Management (China) Co., Ltd. released the relevant documents of its first public offering fund, which is planned to be publicly offered to investors from April 3. The BlackRock Fund issued an industry preferred hybrid securities investment fund on March 9.

According to Huang Xiaoyi, general manager of Fidelity Fund Management (China) Co., Ltd., the company has always been optimistic about the long-term development trend and investment opportunities of the Chinese market, and the launch of the first public offering fund aims to apply the investment philosophy and experience accumulated in the international market to the Chinese market and provide products and solutions for investors. In the future, the company will also introduce deep expertise in investment, pension and ESG into the Chinese asset management market to help Chinese investors achieve diversified financial objectives, Huang added.

Since the beginning of this year, a number of wholly owned foreign public offering institutions have been approved, and foreign-funded public offering fund products have been issued intensively, demonstrating China's unswerving determination to open up its capital market, said Meng Lei, an analyst at UBS Securities, believing more overseas funds will invest and launch products in China in the future.

-- Foreign institutions optimistic about vast opportunities in the Chinese market

Noting the promising investment opportunities this year, many foreign institutions said that they paid closer attention to pro-cyclical investment opportunities brought by China's economic recovery.

Credit Suisse AG expected that China's economy will accelerate after the optimization of epidemic prevention and control measures, and will surpass most major economies in 2023. Janice Hu, CEO of Credit Suisse China, said that the optimization of epidemic prevention and control measures, mature consumer groups, sound fundamentals and the improvement of confidence have paved the way for a strong rebound in the Chinese economy.

Janice Hu added that Credit Suisse AG, as an international financial institution, saw valuable cooperation and development opportunities with the acceleration of the opening-up of the financial industry. It is noted that the company has reached an agreement with local partners for the wholly owned acquisition of Credit Suisse Securities (China) Limited.

Deutsche Bank was optimistic about the overall performance of the Chinese market this year, and predicted that China's GDP growth will be higher than the general expectation this year. With the improvement of China's growth prospects and the continued optimism of global investors on the Chinese market, Deutsche Bank continues to be optimistic about the development potential of bond underwriting, wealth management and custody business.

Samuel Fischer, head of China's debt capital market of Deutsche Bank, said that China's commitment in promoting carbon emission reduction and clean energy transformation, as well as the deepening process of the financial market opening-up, is offering huge business opportunities for foreign banks.

An Yun, chief investment officer of Schroders Group's wholly owned foreign public offering fund business in preparation in China, said that foreign investors' demand for Chinese assets was increasing, and industrial upgrading and consumption upgrading were Schroders' two major focuses.

"It is expected to see the signal of China's economic recovery from the data in the first half of 2023. We believe that the international allocation funds may flow to China, which will cause the valuation expansion of the Chinese stocks. The energy transformation, manufacturing upgrading and domestic demand recovery are the three major directions we are optimistic about," added An Yun. (Edited by Jiang Feifan with Xinhua Silk Road, 346129473@qq.com)