HSBC Global AM awarded 800 million RMB RQFII quota

30 September 2013   Category: News, Asia, China, Hong Kong   By Asia Asset Management

HSBC Global Asset Management in Hong Kong (HSBC) today (September 30) announced it has obtained a quota of 800 million RMB (US$130.67 million) under the Renminbi Qualified Foreign Institutional Investor (RQFII) scheme.
The firm currently plans to use the quota to invest in the fixed income securities in mainland China and will launch a corresponding product after getting regulatory approval. The product will be available to both its retail and institutional clients in Hong Kong.
With 24.2 trillion RMB in size (as of June 30, 2013, according to HSBC and Asian Development Bank), the onshore Chinese fixed income market has been growing strongly since 2000. Total outstanding issue number increased from 107 to 3705, at a compound annual growth rate (CAGR) of 32% (as of February 28, 2013, according to Wind Information) and total outstanding amounts rose from 1.33 trillion RMB to 23,99 trillion RMB, at a CAGR of 27% (as of February 28, 2013, according to Wind Information) between 2000 and 2013. The market is expected to further expand as local corporations in China continue to raise funds through bond issuance as a result of continued growth of the Chinese economy and the government's effort in promoting the debt capital markets as an alternative to bank finance.
Joanna Munro, CEO for Asia Pacific, HSBC Global Asset Management, said: “We are pleased to be one of the first asset managers in Hong Kong to receive the quota allowing us to launch new RQFII products. With our leadership in Asian fixed income and on-the-ground expertise in China through our joint venture, HSBC Jintrust, we are able to provide our clients with a broader range of RMB opportunities to help them achieve their long-term investment goals.”