China’s asset-management growth plummets after sweeping regulations rain down on shadow banking sector
Assets under management worth a combined US$8.22 trillion at the end of 2017 – a 3.49pc annual rise, but a huge fall from the 35.6pc growth it enjoyed in 2016
China’s hopes of becoming the world’s second largest asset management market after the US by next year appear to have been seriously dented, as sweeping new regulations were introduced on the country’s vast shadow banking sector over the past 18 months, in an effort to rein in the nation’s rising debt.
The country’s assets under management, held by fund management firms, securities and futures companies, and privately offered investment funds, were worth a combined 53.6 trillion yuan (US$8.22 trillion) at the end of last year, a 3.49 per cent rise on 2016, according to the latest statistics from the Asset Management Association of China (AMAC).
But that rate has plummeted from 2016, in light of a rash of new industry rules and red tape, when the sector exploded 35.6 per cent to 51.79 trillion yuan from 38.2 trillion in 2015.
More than half of China’s asset management products (AMPs) are offered by securities institutions, with the rest provided by banks and insurers.
The country’s entire asset management industry is believed to exceed 100 trillion yuan in value, if you include cross holdings among all types of institutions.