A branch of the Industrial and Commercial Bank of China. File Photo: Xinhua
The Industrial and Commercial Bank of China (ICBC) announced Tuesday that one of its subsidiaries has received regulatory approval from Chinese regulators to form an asset management joint venture with a unit of US banking giant Goldman Sachs, which will hold a majority stake important step in China’s continued financial opening.
In a filing on Tuesday evening, ICBC, the world’s largest bank by assets, announced that the China Banking and Insurance Regulatory Commission has officially approved a plan for ICBC Wealth Management and Goldman Sachs Asset Management to set up a joint venture in China.
Goldman Sachs will provide 51 percent of the funding for the new joint venture, while ICBC Wealth Management will provide 49 percent according to the filing. China’s new opening up measures enable majority-owned overseas wealth management firms in the country.
The new joint venture will gradually develop investment products in the Chinese market, including quantitative investments, cross-border investments and innovative investment products, according to ICBC.
The approval for the ICBC-Goldman Sachs joint venture comes as more and more US and other foreign financial institutions expand their investments in the Chinese market and take advantage of the financial opening measures.
On May 12, US wealth management giant BlackRock Inc also received a license in China for a majority-owned wealth management company with a unit of China Construction Bank and Singapore’s Temasek Holdings.
In September 2020, following China’s new opening measures, the French asset management company Amundi became the first foreign company to set up a majority foreign asset management company in the Chinese market.
Some foreign politicians continue to complain about access to China’s vast financial market, but Chinese officials and experts have responded by pointing out a growing number of foreign financial institutions, the majority of which are establishing joint ventures in China.