China crackdown on fund house subsidiaries set to force closures
Proposed capital rules for the $1.5 trillion fund subsidiaries segment are tougher than expected, as Beijing further turns the screw on the domestic investment and shadow-banking sectors.
China has unveiled plans to tighten supervision of fund house subsidiaries – a sector worth Rmb10 trillion ($1.53 trillion) – that look set to force the closure of many such businesses.
The tougher-than-expected proposals come soon after a suspension of registration of investment firms, as Beijing continues to tighten regulation of the domestic funds industry and so-called shadow banking.
Fund management subsidiaries function as a channel for shadow banking, the private financin…
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