US lender Brown Brothers Harriman (BBH) has entered into an agreement with Industrial & Commercial Bank of China (ICBC), under which BBH will help asset managers increase their access to Chinese mutual fund market under the newly proposed rules.
With the implementation of the new rules, mutual funds that are native in Hong Kong will be sold in China, and Chinese mutual funds will be sold in Hong Kong, making it a gateway for money managers across the world seeking access to China.
As per the present rules, foreign fund managers can get access to Chinese investors only through joint ventures with Chinese firms.
The deal with ICBC will allow BBH to offer back-office and other services such as trustee functions, accounting, administration, transfer agency, global custody services and foreign-exchange products for Hong Kong-domiciled funds.
BBH managing partner Douglas Donahue was quoted by Walls Street Journal as saying that they have structured a memorandum of understanding with ICBC in China; they have the Chinese distribution and client base and they have global investment expertise and experience.
"We want to be here at the outset of this cross-border cooperation for the big asset managers," Donahue added.