The China Securities Regulatory Commission (CSRC) has green lit the acquisition by JPMorgan Chase of full ownership of its Chinese mutual fund management subsidiary.
On 19 January CSRC gave its approval for JPMorgan Asset Management Holdings Inc to become the full shareholder of China International Fund Management (上投摩根基金管理有限公司) (CIFM), and for JPMorgan Chase to become its actual controller.
CIFM was established in May 2004 as a joint venture between Shanghai International Trust Co., Ltd. (上海信托), which held 51% of equity, and JPMorgan Fleming Asset Management (UK) Limited, which held 49% of equity.
Data from Wind indicates that as of the end of the third quarter of 2022, CIFM had 84 fund products on offer and 141.5 billion yuan in assets under management, as well as ranked 37 out of 141 fund management companies.
The approval from CSRC arrives after Chinese regulators cancelled restrictions on foreign ownership of securities companies and mutual fund companies on 1 April 2020. The following day, JPMorgan Asset Management announced that it had reached a commercial agreement with Shanghai International Trust for full ownership of CIFM.
The approval will make JPMorgan the sixth foreign financial institution to acquire full control of a Chinese mutual fund company, following in the wake of BlackRock, Manulife, Neuberger, Fidelity and Schroders.
JPMorgan will also become the first foreign financial institution to obtain full share ownership of Chinese subsidiaries operating in the four sectors of banking, securities, futures and asset management.