Net Value Wealth Management Products See Market Share Rise Nearly 24 Percentage Points

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Net value bank wealth management products (WMP’s) have seen a surge in their market share over the past year following a push for their adoption from regulators.

As of the end of March China’s wealth management market stood at 25.03 trillion yuan, for a YoY rise of 7.02%, according to figures from the “China Wealth Management Market 2021 First Quarter Report” released by the Interbank Wealth Management Registration and Trusteeship Centre (银行业理财登记托管中心) on 27 April.

Outstanding net value WMP’s reached 18.28 trillion yuan in the first quarter, accounting for 73.03% of the total, or 23.88 percentage points above their share for the same period last year. Interbank WMP’s were 370 billion yuan, for a YoY decline of 56.73%.

Chinese authorities have pushed for a shift away from expected yield WMP’s towards net value WMP’s ever since the release of sweeping new asset management regulations in 2018.

The Q1 report further points out that in the first quarter of 2021 the WMP market saw the addition of 8.1715 million new investors, bringing the total to 49.7963 million, for an increase of 19.63% compared to the start of the year.

The report highlights the emergence of wealth management companies as a major forces in the market, responsible for the issuance of 1452 new products in the first quarter that raised 8.34 trillion yuan in total, accounting for a market share of 27.06%

As of the end of March, the outstanding WMP balance of wealth management companies was 7.61 trillion yuan, for 5.06-fold increase compared to the same period last year, to account for a 30.40% market share.

PBOC says WMP’s provided 21.25 trillion yuan in funding support to the real economy as of the end of the first quarter, for a YoY rise of 4.09%.

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