Net value wealth management products (WMP) have risen to the fore in China as the transitional period for new asset management rules that remove implicit guarantees draws to a close.
A report from Securities Daily indicates that as of 26 October Chinese banks had issued a total of 29,233 net value WMP’s in 2021, as they increasingly become the mainstream within China.
The “China Banking Sector Wealth Management Market Half-Year Report (2021)” (中国银行业理财市场半年报告（2021年上) further indicates that as of the end of June outstanding bank WMP’s stood at 25.80 trillion yuan, of which net value WMP’s accounted for 20.39 trillion yuan, of 79.03%, for increases of 11.75 trillion and 23.90 percentage points respectively.
The outstanding balance of principal guaranteed products was 150 billion yuan, for a drop of 90.68% compared to the same period last year.
Data from Rong360 indicates that during the first three quarters of the year the issuance of net value WMP’s steadily increased with each month.
The third quarter saw the issuance of 8355 net value WMP’s, as compared to 1735 in the second quarter and 868 in the first quarter.
Of the 29,233 net value bank WMP’s issued since the start of 2021 a total of 22,898 are are low to medium-risk, with other risk categories accounting for just a quarter.
