Nikko Asset Management Asia (Nikko AM Asia) has teamed up with the Bank of China and DBS Bank to launch a new China onshore bond fund in mid-July in Singapore.
Subject to regulatory approval, the new fund will provide access to domestic capital markets in China.
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Designed specifically for retail investors in Singapore, the fund seeks a total return of capital growth and income via exposure to RMB and its denominated fixed income instruments.
The fund will invest primarily in a portfolio of RMB-denominated certificates of deposits, preferred shares, bonds, money market funds and fixed income instruments issued onshore by the Chinese governments, corporations and financial institutions.
Following the receipt of regulatory approval, investors will be able to invest in RMB through the Bank of China and DBS Bank.
Eleanor Seet, president of Nikko AM Asia, said: "We take pride in being a forerunner in RMB internationalisation by providing Singapore domiciled investors with direct access to China onshore bonds, which are not readily accessible to foreign investors.
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By GlobalData"This is the first in a suite of RQFII solutions we are planning to provide. We expect allocations into this market from both local and global investors to grow, especially with a long-term positive outlook on the currency," Seet added.
Wang Lei, assistant general manager, Bank of China Singapore Branch, said: "This milestone collaboration with Nikko AM in Singapore taps on our strong foothold in China and further reinforces our position as the leading provider of RMB wealth management products in Singapore."
