Fidelity International has become the first global asset manager to register with the Asset Management Association of China as a private fund management company with its wholly foreign-owned enterprise in Shanghai.
This qualification allows Fidelity International to create onshore investment products in China for eligible Chinese institutional and high net worth investors for the first time, and is seen by the firm as “crucial” to its long-term China strategy.
Mark Talbot, managing director, Asia Pacific, Fidelity International, said that the deal is a “significant milestone” as the US investment giant bids to expand its operations within the world’s second-largest economy.
“We have been operating in China since 2004, offering offshore capabilities to domestic institutional clients, and retail investors through partnering with banks under the Qualified Domestic Institutional Investor (QDII) programme,” said Talbot. “China is crucial to our global growth strategy.”
Originally established in September 2015 in Shanghai, Fidelity International’s WFOE, FIL Investment Management (Shanghai) Company Limited has representative offices in Shanghai and Beijing, as well as an operating centre in Dalian, employing a total of over 400 staff in China.
FIL has a quota of US$1.2bn under the Qualified Foreign Institutional Investor (QFII) scheme, one of the largest amounts held by any fund manager globally.
The QDII system allows qualified domestic institutional investors, within a certain quota approved by the regulatory authorities, to invest in the overseas securities market. The QFII scheme is an arrangement that allows eligible institutional investors to invest in China’s capital market.
“We firmly believe a local presence in China is critical not only to understand clients’ needs, but also to actively identify investment opportunities through our global research and investment capabilities,” added Daisy Ho, managing director, Asia Pacific ex Japan, Fidelity International.
“We are set to offer onshore investors an opportunity to capture the long-term investment opportunities in China through our WFOE private fund management company.”
Globally, Fidelity International had US$290bn in assets under management as of September 30, 2016.