Deutsche Bank's asset management arm will sign a deal in Beijing today to break into the mainland's thriving fund management market. Deutsche Asset Management will take an almost 20 per cent stake in Harvest Fund Management, one of the country's 10 oldest fund managers. Deutsche's willingness to take a stake well below the regulatory 49 per cent ceiling hints at its greater ambition. The relatively minor investment in Harvest will free Deutsche to secure a bigger interest in yet another mainland mutual fund house as permitted under the regulations. Buying into Harvest will give Deutsche quick access to the mainland's fund management market and, more importantly, the fledgling pension business. The mainland asset manager was one of the first to secure a licence to manage stock-market investments for the government-controlled National Social Security Fund and is eyeing a licence to manage corporate pension funds. Incorporated in Shanghai but based in Beijing, six-year-old Harvest had 18.6 billion fund units under management in five open-ended funds and two closed-end portfolios by the end of last year, according to the company and China Securities Regulatory Commission data. An eighth fund is now on sale. Harvest's development suffered a big setback a few years ago because of a bitter internal dispute over investment strategy. General manager Hong Lei and chief investment officer Bo Tao opposed the board's decision to invest in high-risk firms, including Shenzhen-listed Yorkpoint S&T, one of the most notoriously manipulated stocks. The dispute resulted in Mr Hong's dismissal by the board and led to an October 2000 article in Caijing magazine describing rampant speculative trading activities and other scandals at fund managers. Mr Hong went on to become a deputy director-general of the commission's fund supervision department.