JPMorgan, Fidelity win approvals as China further opens up domestic markets
- Approvals come as regulatory crackdown on tech sector has unnerved some investors
- JPMorgan first foreign lender to win approval for taking full control of securities joint venture
Beijing has granted a series of licences to Wall Street banks and overseas asset managers as it further opens up its domestic financial markets against the backdrop of a rapid regulatory crackdown on the technology sector that has sapped the confidence of some foreign investors in Chinese listings.
“China represents one of the largest opportunities in the world for many of our clients and for JPMorgan Chase,” Jamie Dimon, JPMorgan’s CEO, said in a statement. “Our scale and global capabilities give us a unique ability to help Chinese companies grow internationally and also support global investors as they expand into China’s maturing capital markets.”
The American bank separately received approval last year to take full control of its futures business in China and has reached an agreement to buy out its asset management joint venture partner on the mainland.
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The blitz of approvals comes as Beijing has heightened its scrutiny of the technology sector and off-campus tutoring sectors since early July, unnerving investors with rapid regulatory changes that have wiped more than US$1 trillion in value off Chinese companies listed in the United States and Hong Kong.
Fidelity International confirmed on Monday that it separately received approval from the CSRC to establish a wholly foreign-owned mutual fund company in China, the second foreign asset manager to receive such an approval after BlackRock won a licence in June.
“We are absolutely thrilled to reach this milestone, which was achieved in close cooperation with the CSRC and the hard work of our teams on the ground,” said Rajeev Mittal, managing director for Asia excluding Japan at Fidelity International. “We look forward to the next steps. This underlines our strong commitment to China.”
The new licences come just days after Citigroup won approval to begin offering security investment fund custody services onshore and BNP Paribas was granted a licence to provide custody services under China’s Qualified Foreign Investor (QFI) scheme.
“We are delighted to assist more of our global clients in participating in the continuously opening Chinese capital markets,” said Christine Lam, CEO of Citi China.
