China has issued $9.02bn worth of quotas to 21 firms under the qualified domestic institutional investor (QDII) scheme last week, according to data from the State Administration of Foreign Exchange (SAFE).
Launched in 2006, the QDII programme allows domestic institutions and fund managers to invest in offshore investments within allowable quotas.
The move comes after the regulator said last year it was planning to dish out more quotas. In 2020, there were three rounds of quota issuances, which totalled $12.72bn. Before that, the last time the regulator issued quotas was in April 2019.
Most of the firms that received the fresh quotas were fund management companies (14 in total), which received 90% of the new quota, compared to 63% issued in 2020, according to data from Z-Ben Advisors.
Six mutual fund companies each received sizable quotas of $800m, while four firms each received quotas between $500m-$700m, according to SAFE data (see below).
The other firms that received quotas were three wealth management subsidiary of banks, two banks, and two insurance companies.
Z-Ben noted that Bank of Ningbo (BNB) Wealth Management became the second bank wealth management subsidiary to receive its own quota, after PSCB Wealth Management in September, while Citi is now the largest bank quota holder with $3.5bn after its first new issuance in 2014, Z-Ben noted.
Firms that received quotas
|Firm||Quota given on 13 Jan ($m)||Total quota as of 13 Jan ($m)||Firm type|
|E Fund Management||800||3850||Fund management company|
|China Southern Asset Management||800||3750||Fund management company|
|Bosera Asset Management||800||2850||Fund management company|
|GF Fund Management||800||2450||Fund management company|
|Fullgoal Fund Management||800||2130||Fund management company|
|China Universal Asset Management||800||1400||Fund management company|
|China Merchants Fund Management||700||2000||Fund management company|
|Penghua Fund Management||600||1700||Fund management company|
|Yinhua Fund Management||600||1500||Fund management company|
|Harvest Fund Management||500||4100||Fund management company|
|Fortune SG Fund Management||300||1350||Fund management company|
|CITIC-Prudential Fund Management||300||1130||Fund management company|
|AIA Life Insurance||300||468||Insurance company|
|Caitong Fund Management||200||370||Fund management company|
|RongTong Fund Management||150||1050||Fund management company|
|Taikang Insurance (first-time recipient)||150||150||Insurance company|
|China Merchants Bank||100||300||Bank’s wealth management subsidary|
|China Everbright Bank||100||200||Bank’s wealth management subsidary|
|BNB Wealth Management (first-time recipient)||100||100||Bank’s wealth management subsidary|
|Hang Seng Bank (China)||20||50||Bank|
Since the programme began, SAFE has granted $125.7bn in QDII quotas to 171 licence holders, with Ping An Insurance Group having the largest quota of $7.59bn, followed by Sino Life Insurance ($4.41bn), Harvest Fund Management ($4.1bn), China Asset Management ($3.85bn), and E Fund Management ($3.85bn).