The joint venture company, with headquarters in Shanghai, will create, manage and sell mutual funds in local currency to retail and institutional investors in China.
Under the terms of the agreement, Royal Bank of Canada (RBC) will hold a 30% interest in the joint venture, China Minsheng Bank will hold a majority interest of 60%, and Three Gorges Finance Co will hold a 10% interest.
This exciting initiative provides us with an entry point into the rapidly expanding Chinese asset management market, said George Lewis, executive vice president of wealth management at RBC Financial Group and chairman and CEO of RBC Asset Management.
The fund management market in China is poised for growth, making this an opportune time to form this joint venture, added Hong Qi, executive vice president of China Minsheng Bank. It also serves to reinforce the growing realization that Chinese capital markets offer good potential investment value.
The venture follows a series of moves for RBC in China. Back in February, the bank upgraded its representative office in Beijing to a branch, which will enable RBC to provide a variety of services to clients in Canada and China. Then, in August, the company announced the opening of RBC Life Insurance Company’s new representative office in Beijing.
RBC Capital Markets also recently announced its mandate as co-lead manager of the institutional tranche for the Industrial and Commercial Bank of China’s estimated $21 billion initial public offering.
