The asset management arm of Aegon has signed a memorandum of understanding (MOU) with the Shanghai Lujiazui Administration Bureau, a free trade zone in China, in a bid to support its build-up of a global asset management centre.
By signing the MOU, Aegon Asset Management has taken its first steps to establishing a wholly foreign-owned enterprise in Shanghai.
This will allow it to sell offshore investment products and services to the domestic institutions and high net worth investors in China.
Martin Davis, head of Aegon Asset Management Europe said: “As signatories we will be one of an early group of global asset managers able to bring world class investment strategies to the domestic Chinese high net worth and institutional market.
“As such we are extremely pleased to be working with the Shanghai Lujiazui Administration Bureau to establish this new centre of asset management excellence.”
Growing China business
Aegon AM is looking to bolster its business in China with the establishment of the wholly foreign-owned enterprise.
The firm already has a Chinese joint venture Aegon Industrial Fund Management Company (AIFMC).
Aegon also entered into partnership with Industrial Securities in 2008 to provide fund products and asset management services to the local public domestic market.
It has a 49% stake in AIFMC, which it formed with majority owner Industrial Securities in 2008 to provide CSRC-approved fund products and asset management services to the onshore market.
At present, there are about 18 foreign firms with private fund management licences, which enables them to launch onshore products to qualified institutional and high net worth. Fourteen of those firms, which include Schroders, Fidelity and Value Partners, have launched at least 30 onshore funds for qualified investors.
Other firms, such as Blackrock, Neuberger Berman and UBS Asset Management have also obtained qualified domestic limited partnership licences, which allow them to raise money domestically to invest in offshore investments, with assigned quotas.