China’s Pension Wealth Management Products Raise 95B Yuan in Funds

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Pension wealth management products (WMPs) in China have seen rapid growth in popularity since the launch of pilot trials towards the end of last year.

According to figures from PY Standard, as of 9 October 2022 China had seen the sale of 48 pension WMPs by 9 wealth management companies, raising approximately 95 billion yuan in funds.

The first three quarters of 2022 alone saw the launch of 23 pension WMPs, raising more than 38 billion yuan in funds.

Pension WMP trials in China officially kicked off on 15 September 2021, with 11 bank wealth management subsidiaries obtaining approval from authorities to issue products in a total of 10 trial cities.

As of October a total of nine wealth management subsidiaries had issued pension WMPs, including those operated by ICBC, China Construction Bank, Agricultural Bank of China, Bank of China, Bank of Communications, Postal Savings Bank of China and China Everbright Bank.

Chinese regulator have emphasised the development of stable and inclusive pension WMPs, primarily involving closed fixed-income products with low-to-medium risk levels and a term of five years or more.

According to state-owned media the annualised performance of the products is set at between 5 – 8%. Since the start of the year however, many bank WMPs have seen declines in their net value as a result of market volatility.