Morgan Stanley wins nod to fully own Chinese fund venture

February 04, 2023 02:36 AM AEDT | By Reuters
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BEIJING (Reuters) -Morgan Stanley said on Friday its asset management unit has received Chinese regulatory approval to take full ownership of a China mutual fund venture, marking a key step toward broadening its footprint in the world's second-biggest economy.

The announcement comes two weeks after JPMorgan received a nod to buy out its China mutual fund venture, as Beijing speeds up approvals to foreign financial institutions.

The China Securities Regulatory Commission (CSRC) has allowed Morgan Stanley Investment Management to boost its stake in Morgan Stanley Huaxin Funds to 100% from 49%, the Wall Street bank said.

"Wholly-owning our China mutual funds business will allow us to more fully serve this dynamic asset and wealth management market and adds a significant pillar of growth to our global investment management franchise," Dan Simkowitz, Head of Investment Management at Morgan Stanley, said in a statement.

Gokul Laroia, CEO of Asia at Morgan Stanley, said the bank has been active in China for almost three decades, and is fully committed to growing in the country.

"With high levels of wealth creation, growing demand for financial advice, and with the launch of a private pension scheme, we see long-term opportunities in China's asset management industry," Laroia added.

China has granted a slew of licences to foreign banks and asset managers in recent months as Beijing has reopened its economy after three years of strict zero-COVID restrictions.

The CSRC has recently awarded mutual fund licences to Fidelity International and Neuberger Berman, and has allowed Schroders to set up a wholly-owned unit in China's $3.7 trillion retail fund industry.

Headquartered in Shenzhen, Morgan Stanley Huaxin Funds is a joint venture between Morgan Stanley Investment Management and Chinese brokerage Huaxin Securities.

($1 = 6.7380 Chinese yuan renminbi)

(Reporting by Hong Kong newsroom. Editing by Jane Merriman and Louise Heavens)


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