Minsheng Gets Green Light for Fund Venture
China Minsheng Banking Corp, the nation’s seventh largest bank by market value, got approval from the China Banking Regulatory Commission to set up a fund management company with Royal Bank of Canada and Three Gorges Financial Co.
Minsheng said it would take 60% of the venture, while Royal Bank of Canada, the country’s biggest lender, would control 30%. Three Gorges would hold the rest 10%.
Banks’ advantages over asset management firms lie in their reliable credit, wide networks and customer resources. And selling and being trustee of funds can create considerable income for banks while diversified wealth management products will help strengthen customer loyalty.
The fund company is Minsheng’s latest move toward becoming a financial holding firm. The bank also plans to pay 2.34 billion yuan for a stake in Shaanxi International Trust & Investment Corp and buy up to 20% of UCBH Holdings Inc, which is the biggest bank serving the Chinese community in the US.
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