Posted inChina

Manulife IM takes full ownership of China fund management JV

It is the first wealth and asset manager to convert its joint venture into a wholly foreign owned public fund management company.
Made in China. Cardboard boxes with text made in China and chinese flag on the roller conveyor. 3d illustration

The China Securities Regulatory Commission (CSRC) has granted Manulife Investment Management (Manulife IM) approval to take full control over its fund management joint venture with TEDA Investment Holding, according to an announcement by the investment manager.

Manulife IM will acquire 51% of the shares in Manulife TEDA Fund Management from its partner, taking its ownership stake to 100% upon completion of the transaction.

“We are privileged to be able to help customers in China achieve their financial objectives while managing their wealth through our fully owned public fund management company,” said Paul Lorentz, president and CEO for global wealth and asset management at Manulife IM.

“We are excited by the opportunity to continue to provide both institutional and individual investors in China with professional products and services, supporting the development and growth of China’s pension system and helping Chinese people to meet their growing needs for retirement planning.”

Manulife will become the first Canadian financial services company to wholly own a public fund management company in China.

The full acquisition will enable Manulife IM to better serve the growing investment needs of investors in the China market and represents an important milestone in the wealth and asset manager’s growth ambitions in the country, said the Canadian company in the same announcement.

The Manulife-TEDA joint venture was set up in 2010, with Manulife having been a 49% foreign partner in the company.

Earlier this month, the CSRC also approved the appointment of Xu Jin as the chairwoman of Manulife’s wealth and asset management business in China.

Manulife IM also launched its wholly foreign owned enterprise in Shanghai in March 2017 and owns another joint venture, Manulife-Sinochem Life Insurance, which serves 2.6 million customers in the country.

China’s total retail fund assets under management grew 27% year-on-year to $3.8trn in 2021 and is forecast to more than double by 2025, according to the Asset Management Association of China.

An earlier study by Broadridge has also found that more global asset managers are pursuing, or at least seriously considering, setting up more entities in China to establish better control over product development and safeguard against regulatory concerns.

“It is good to have options in China because regulations may tighten in one product segment versus another. We have seen this happen many times when it comes to the Chinese banking sector,” said Yoon Ng, principal of distribution insight at Broadridge.

Part of the Mark Allen Group.