The Haitong Global RMB Fixed Income Fund launch -- which will formally take place on Wednesday (August 11) -- follows last month’s move to relax the rules on renminbi accounts, settlement and trading in
Indeed, other asset managers – among them, Harvest, HSBC and RCM – have expressed an interest in launching RMB funds.
Haitong’s new product seeks long-term capital growth through investment in a portfolio consisting primarily of RMB-denominated fixed- or floating-rate debt instruments issued or distributed outside mainland
The fund may also invest in other RMB-denominated deposits issued outside mainland
The fund intends to make semi-annual dividend distributions payable in June and December in RMB, subject to the fund manager’s discretion. There is, however, no guarantee on the minimal dividend amount and number of distributions to be made. The minimum investment is Rmb10,000. BOCI-Prudential Trustee is the trustee and Bank of China (
Meanwhile, HSBC – which will be one of the distributors of the Haitong RMB fund – yesterday launched its first RMB retail certificate of deposit (RMB CD), which sold out within the first banking hour. This follows the launch of HSBC’s first tranche of RMB-denominated FX-linked deposits last month, which was also taken up within the first day.
“Investors’ interest in RMB-denominated products is mounting and so is the demand,” says Lin Yong, chief executive of Hai Tong (HK) Financial Holdings, Haitong AM’s parent company. “We will ride on this growing trend and seek to achieve investment returns through active management of the major risks associated with RMB income instruments.”
However, there are still things that need clarifying, as Cecilia Chan, HSBC’s
Still, such issues are likely to be swiftly resolved, given the will to develop the RMB market.