The annual global ranking of foreign asset managers in China has been released by Z-Ben Advisors, the Shanghai-based consultancy.
Last year’s chart-topper JPMorgan remains the best positioned on the market with a 62.7 percent score, up from 51.1 in 2016, with UBS also retaining its second place from 2016. HSBC, Invesco and Schroders take up the following positions, reflecting the dominance of European fund houses, which make up nearly half of the top 25, as well as the progress of US entities. Only three Asian names make the list this year: Japan’s Nikko and Hong Kong-based Hang Seng and Value Partners.
The ranking, now in its second year, has been benchmarking the China strategies of foreign investment managers across three business areas: onshore asset management, inbound flows and outbound flows.
Assets under management in the Chinese public mutual fund industry remain flat for 2016 at $1.3 tn after growing steadily for five years, with seven of the top 15 largest managers Sino-foreign joint ventures, the study reveals.
The private fund industry, where foreign investors can now raise and manage capital under their own brand name, grew by 54 percent last year. ‘We expect the first global manager will grab a piece of this pie in 2017,’ says the consultancy in a note explaining the findings.
Another significant change comes from the fixed income sphere. With the country ‘throwing open the door to its $9.3 bn interbank bond market to global investors’, the latter have reportedly started ‘positioning themselves to enter the market.’
Competition has reached a new level on the Chinese market, according to the study, which highlights that more than a quarter of last year’s top 25 global managers fail to make this year’s list. ‘Stand still and your competitors will overtake you,’ it notes. ‘To remain consistent in positioning requires that global managers have in place a well-diversified China strategy and an approach that is fluid enough to evolve in response to rapid regulatory shifts and inconsistent client demand.’
