The world’s biggest fund manager is awaiting renminbi qualified foreign institutional investor (RQFII) quota that will allow it to invest in mainland Chinese assets using offshore RMB.
BlackRock has won the RQFII licence from the China Securities Regulatory Commission and is waiting to see how much it will receive from the country’s State Administration of Foreign Exchange.
The fund manager already has two QFII quota batches of $100 million each, awarded in June 2012 and March 2013, but the RQFII scheme will allow more flexibility as to the types of assets it can buy.
Marc Desmidt, head of strategic product management for Asia Pacific, says: “China is an important investment destination for our clients globally as it undergoes a pivotal transformation, and gradually internationalises its capital markets.”
Certainly, BlackRock has steadily built out its Asian business with a strong focus on the mainland.
Perhaps most significant has been the firm’s early-mover commitment to build a platform for Hong Kong-domiciled funds with a view to selling them into China under the proposed mutual recognition agreement.
There’s also been hire of respected mainland dealmaker and Goldman Sachs veteran Wang Hsueh-Ming last year as China chairman, and of Helen Zhu, Goldman’s chief China equity strategist, last month.
Yet it hasn’t all been plain-sailing. BlackRock lost its lead China fund manager, Ning Jing, to Fidelity in mid-2013. It is also about to undergo a management transition, with Asia-Pacific head Mark McCombe leaving for the US later this year, to be replaced by Ryan Stork in an internal transfer.
Still, such changes seem unlikely to affect the fund house’s resolve to establish itself as a leading player on the mainland stage.