China's State Administration of Foreign Exchange yesterday awarded United States investment bank Morgan Stanley a US$300 million investment quota to trade yuan A shares and selected Chinese bonds, the foreign exchange regulator announced.
The news came after last-minute technical hiccups delayed the first trade under the qualified foreign institutional investors (QFII) scheme, which gives foreign institutions direct access to publicly traded A shares.
Foreign investors have long set their eyes on A shares, which account for most of China's free-floating stock market capitalisation of US$174.01 billion and are more representative of the mainland economy than overseas-listed Chinese firms.
Swiss bank UBS previously won a US$300 million investment quota, while Japanese brokerage Nomura and Citigroup Global Markets, formerly Salomon Smith Barney, were given US$50 million and US$75 million respectively.
Technical hitches have also pushed back the launch of the first offshore A-share fund, to be managed by Edinburgh-based fund manager Martin Currie Investment Management, using UBS' QFII quota and distribution networks.
Subscription to the fund, being marketed in Hong Kong and aimed at raising at least US$50 million from institutions globally, will be closed on July 17, Martin Currie's Shanghai-based portfolio manager, Chris Ruffle, said yesterday.
