A leading regional lender has obtained approval from the Chinese authorities to establish its own wealth management subsidiary.
Hong Kong-listed Huishang Bank (徽商银行) announced on the evening of 23 August that it had obtained approval from the China Banking and Insurance Regulatory Commission (CBIRC) to prepare to establish its wealth management subsidiary Huishang Bank Wealth Management Co., Ltd. (徽银理财有限责任公司).
Huishang Bank is headquartered in the Anhui-province capital of Hefei, and CBIRC’s approval makes it the third municipal commercial lender to be greenlighted for a wealth management subsidiary after Bank of Hangzhou and Bank of Ningbo.
Huishang Bank Wealth Management will be a fully invested subsidiary of Huishang Bank with registered capital of no more than 2 billion yuan, while its registered address will be in Hefei.
At present a total of 32 banks in China have unveiled plans to establish their own wealth management subsidiaries, including six state-owned banks, nine joint-stock banks, 15 municipal commercial banks and two rural commercial banks.
The wealth management subsidiaries of five of the big state-owned banks have already commenced operation, including Agricultural Bank of China, Bank of China, Bank of Communications, China Construction Bank and Industrial and Commercial Bank of China, while another seven banks have obtained approval for preparations to establish their own subsidiaries.
Huishang Bank’s 2018 annual report indicates that as of the end of last year its outstanding wealth management product (WMP) balance was 114.162 billion yuan.
Nearly 90% of these WMP’s were non-principal guaranteed WMP’s, while the net value WMP balance was 12.786 billion yuan.
