Greater Bay Area’s Wealth Management Connect scheme to expand eligibility, product range, investment limits

New measures will further ‘cross-boundary investment … and the development of Hong Kong’s financial industry’, says monetary authority CEO
Expansion of eligible southbound and northbound products aims to better meet GBA residents’ demands for diversified investments, HKMA says

Hong Kong Monetary Authority (HKMA)

Mia Castagnone

Published: 10:06pm, 28 Sep 2023

Why you can trust SCMP

The cross-boundary Wealth Management Connect scheme will expand eligibility to more Greater Bay Area (GBA) residents, expand its range of investment products and raise its investment limits for individuals, among other changes, in a bid to accelerate adoption.

The number of participating institutions will also expand to include eligible securities firms, allowing such lenders to distribute investment products and provide relevant services to southbound and northbound individual investors, the Hong Kong Monetary Authority (HKMA) said in announcing enhancements to the scheme on Thursday.

“We welcome the introduction of the enhancement initiatives and are developing implementation details to put the initiatives into action at full speed,” said Eddie Yue, the CEO of the HKMA.

The new measures will “further facilitate cross-boundary investment of Greater Bay Area residents and the development of Hong Kong’s financial industry”, he added.

People wait in a bus shelter in Guangzhou, one of the mainland China cities in the Greater Bay Area. Photo: Xiaomei Chen

The expansion of eligible southbound and northbound products aims to better meet GBA residents’ demands for diversified investments, the HKMA said. The scheme will also get further promotion to acquaint GBA residents with its participating financial institutions and their services.

The scheme, launched in 2021, is Beijing’s first tailor-made plan for the 11 cities of the GBA development zone.

It allows 24 banks, including HSBC, Standard Chartered and Bank of China (Hong Kong), to sell Hong Kong investment products to the residents of the zone’s mainland cities through 31 banking partners.

Hong Kong and Macau regulatory bodies, including the Securities and Futures Commission of Hong Kong and the Monetary Authority of Macau, worked with mainland Chinese authorities to bring forward the new measures.

Financial regulators in mainland China, Hong Kong and Macau will continue to revise and refine the relevant implementation details, the HKMA said in its announcement.

The devil in Greater Bay Area’s blueprint stunts cross-border wealth plan

As of the end of April, the scheme had attracted about 50,000 investors, who invested 3.4 billion yuan (US$139.45 million), according to government data.

That figure is a mere 1 per cent of the 300 billion-yuan quota set in 2021 when the plan was launched.

Nelson Chow, the chairman of the Hong Kong Investment Funds Association, the industry guild, had previously said the scheme’s sales had been “lower than expected”, due to “the narrow range of products”.

“The new enhancements will allow eligible brokers to participate in the pilot scheme for the first time, provide more mainland investors with a wider choice of fund products and further strengthen the connectivity of the Greater Bay Area markets,” said Julia Leung Fung-yee, the SFC’s CEO.

“We look forward to working closely with the mainland regulators, the Hong Kong Monetary Authority and the industry in implementing these enhancements,” Leung added.

Post