Eastspring Investments (Eastspring), an investment arm of UK-based insurer Prudential plc, has become the latest foreign manager to set up a wholly foreign-owned enterprise (WFOE) for investment management in China.
Eastspring named Bernard Teo, its head of corporate strategy, mergers & acquisitions, as its legal representative, and Michael Lu, former head of Robeco’s China subsidiary, as general manager of the WFOE.
The WFOE will “enable us to establish an on-the-ground presence in mainland China and complements our existing joint venture partnership with CITIC-Prudential Fund Management Company”, Eastspring Chief Executive Guy Strapp says in a statement on March 9.
Prudential established the joint venture with CITIC Trust in 2005.
“China is an important market for Prudential and is central to our strategy for Asia. Its strong economic growth and wealth accumulation offers an unprecedented opportunity for Eastspring to increase its participation in this growing mutual fund market,” explains Nic Nicandrou, chief executive of Prudential Corporation Asia.
China Securities Regulatory Commission (CSRC), the Mainland securities regulator, has approved WFOE status for the investment management subsidiaries of more than 26 foreign managers, including BlackRock Inc and Fidelity International (Fidelity), since January 2017.
Licence-holders are allowed to launch onshore private funds for domestic institutional investors by registering as private fund managers (PFM) with the Asset Management Association of China, which represents China’s fund industry.
To date, 11 foreign managers, including Singapore’s Fullerton Fund Management (Fullerton), have received PFM qualification, and four – Fidelity, Fullerton, Man Group and UBS Asset Management – have announced that they have launched onshore private fund products.
Eastspring had over US$170 billion in total assets under management as at mid-2017.
