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China issues another round of QDII quotas

Seven firms received the quotas for the first time.

China has issued $5.06bn worth of quotas to 34 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 institutions and fund managers to invest offshore within allowable quotas.

The move confirms a recent report that SAFE was planning to issue up to $10bn worth of QDII quotas in the “near future”. It also comes after the regulator issued $3.36bn worth of quotas in September, the first since April 2019.

Of those that received the fresh quotas, seven of them were first time recipients, with six of them each receiving a quota amounting to $100m, according to SAFE records.

First-time recipients

Firm Quota ($m)
TruValue Asset Management 100
Great Wall Fund Management 100
Zhong Ou Asset Management 100
Ping An Securities 100
Aeon Life Insurance 100
CITIC-Prudential Life Insurance 100
Fubon Bank (China) 10
Total quotas granted 610
Source: SAFE

Meanwhile, around 18 firms each received additional quotas of around $200m, and eight each received a quota of $100m (see below).

The 34 recipients included banks, securities firms, fund management firms and insurance companies. Around 55% of the recipients were fund managers.

In total, there are 164 QDII quota holders, with Ping An Insurance Group holding the largest quota of $7.19bn, followed by Sino Life Insurance ($4.41bn), China Asset Management ($3.85bn), Harvest Fund Management ($3.6bn) and China Life Insurance ($3.55bn).

Since the programme began, SAFE has granted $112bn of QDII quotas, according to SAFE data.

New QDII quota allocations were suspended for three years from 2015 when China’s stock market crash triggered massive capital outflows. They were resumed in April 2018 and 24 firms received fresh QDII quotas of $8.33bn.

Firms that received additional quotas in November

Firm Quota given in November ($m) Total quota as of 08 Nov 2020 ($m)
Hua An Fund Management                         200                                       1,550
China Southern Asset Management                         200                                       2,950
China Asset Management                         200                                       3,850
ICBC Credit Suisse Asset Management                         200                                           500
China International Capital                         200                                       2,400
HFT Investment Management                         200                                           700
China Universal Asset Management                         200                                           600
GF Fund Management                         200                                       1,400
Penghua Fund Management                         200                                       1,100
UBS SDIC Fund Management                         200                                       2,000
CCB Principal Asset Management                         200                                           300
Everbright Pramerica Fund Management                         200                                           750
Dacheng Fund Management                         200                                           550
Huatai-Pine Bridge Fund Management                         200                                           580
Tianhong Asset Management                         200                                           400
PICC Property and Casualty                         200                                       1,000
China Pacific Insurance (Group)                         200                                           237
ICBC – AXA Life Insurance                         200                                           208
The Bank of East Asia (China)                         100                                           300
Standard Chartered Bank (China)                         100                                       2,100
DBS Bank (China)                         100                                           985
BNP Paribas China                         100                                           200
United Overseas Bank China                         100                                           400
Huatai Securities (Shanghai) Asset
                        100                                           400
China Securities                         100                                           360
Qianhai Life Insurance                         100                                           600
CITIC-Prudential Fund Management                           50                                           830
Total quotas granted                     4,450
Source: SAFE

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