The wealth management vehicles of some of China’s leading banks have reduced their fees for health management products (WMP’s) in response to rising competition.
Since the start of 2022 a slew of leading WMP vehicles have provided discounts for some of their products, including the WMP subsidiaries of Bank of China (BOC), Bank of Communications (BOCOM), China CITIC Bank and Industrial Bank Co., Ltd.
The reductions cover fixed management fees, sales services fees, and custody fees.
CITIC’s WMP subsidiary announced on 23 February that for the period from 3 March 2022 to 31 March 2023 it would reduce both its fixed management fee and sales services fee from 0.30% per year to 0.05% for its “Quanyingxiang Gushou Wenjian Niankai No. 8” WMP, while its custody fee would fall from 0.05% to 0.03%.
BOCOM’s wealth management subsidiary has announced that it has reduced the fixed management fee for one of its WMP’s from 0.20% per year to 0.05% per year for the period from 9 February 2022 to 7 March 2023.
BOC’s wealth management subsidiary has also announced that starting from 1 April it will reduce its fixed management fees from 0.10% per year to 0.05%.
Industry insiders said to state-owned media that the fee reductions are part of efforts to improve competitiveness and expand the scope of assets under management, amidst rising pressure within the Chinese wealth management sector.