Foreign Institutions’ Participation in the Wealth Management Business Encouraged by the CBIRC in Various Aspects
On January 3, 2020, the China Banking and Insurance Regulatory Commission (the “CBIRC”) published the Guiding Opinions on Promoting the High-Quality Development of the Banking and Insurance Industries. The Guiding Opinions encourage foreign funded institutions to participate in the wealth management business in various aspects, without prejudice to the policies prescribed in the “11 measures” issued by the Office of Financial Stability and Development Committee of the State Council in July, 2019. The main measures are fourfold. First, foreign funded banks are encouraged to collaborate with their parent banks in the featured business including the wealth management business. Second, foreign financial institutions are encouraged to make equity investment(s) in the wealth management subsidiaries of commercial banks. Third, foreign asset management institutions are allowed to set up foreign-controlled joint venture wealth management companies with subsidiaries of domestic funded banks or insurance companies. Finally, it is intended that foreign financial institutions with the wealth management business may be attracted to enter into the onshore market.