Canadian manager wins first RQFII licence in N America

The asset management arm of a giant Canadian wealth firm has won the first RQFII licence in North America, months after it established a Hong Kong office.
Canadian manager wins first RQFII licence in N America

CI Investments has become the first Canada-based asset manager to receive an RQFII licence from China’s securities regulator.

The Canadian fund house is now waiting for a renminbi quota to invest in mainland Chinese assets.

The renminbi qualified foreign institutional investor licence was unveiled yesterday by HSBC, CI Investment’s custodian bank in China, but the China Securities Regulatory Commission (CSRC) has not yet announced it on its website. AsianInvestor understands the licence was granted at the end of June. 

“In China, we see long-term economic growth and attractive investment opportunities for our investor,” said Eric Bushell, senior vice-president at CI Investments.

In January this year, CI Investments and its division Signature Global Asset Management set up an office in Hong Kong - CI Global Investments Asia - for investment research in China and Asia. The office was headed by Gorlen Zhou, the firm’s director of research in Asia.

“The debt and equity markets in Asia are maturing rapidly and will grow to match the region’s considerable influence in the global economy,” said Bushell, who is also the chief investment officer at Signature GAM.

The asset management arm of Canada’s CI Financial Corp will now need to apply for the renminbi quota from China’s State Administration of Foreign Exchange (Safe).  The quota application usually takes one to two months, but as of the end of July CI Investments had not received a quota, according to the Safe website.

Canada became the first North American country to be included in the RQFII scheme in November 2014, with an allocation of Rmb50 billion ($8 billion). Toronto was given permission to establish a renminbi clearing centre in March this year.

China has expanded the RQFII scheme, which allows foreign investors to invest in onshore equities and bonds, beyond Asia both in terms of quota size and the speed of licence approval.

Deutsche Asset & Wealth Management won the first licence in Germany in February, and received a total of Rmb6 billion in March. 

The US index fund giant Vanguard received Australia’s first RQFII licence in March and total quotas of Rmb10 billion in April.

Reinsurance firm Swiss Re secured the first RQFII licence in Switzerland in late June, and then received a total of Rmb5 billion in quota in late July.

CI Investments is a subsidiary of CI Financial Corp, a Canadian-owned wealth management firm with an AUM of C$140 billion ($106.3 billion) as of June 30 this year.

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