Haitong International is applying for an asset management licence in Singapore and will seek a renminbi qualified foreign institutional investor (RQFII) licence, with a view to sub-advising on RQFII exchange-traded funds.
Such approvals would enable the offshore arm of Chinese brokerage Haitong Securities to provide advisory services and sell renminbi products to high-net-worth individuals and institutional investors.
“We are now in talks with some Singaporean fund managers for a potential partnership for RQFII products, such as [acting as a] sub-adviser for an RQFII ETF,” adds Ben Zhang, who heads Haitong International’s asset management arm.
Having received a brokerage licence in the Lion City in August, the firm made it clear it is on the hunt for acquisitions there, as reported by AsianInvestor. It will not rule out buying a local asset management firm, says Lin Yong, chief executive and deputy chairman.
“Singapore is the centre [in Asia] for commodity, bond, future and foreign exchange trading,” Lin says. “We hope to make use of these instruments to diversify our product offerings and tap into the institutional market.”
As the firm sets its sights on expanding its wealth and asset management business across Asia and the Middle East, Singapore represents an important hub, she adds.
Acquisition is a route Haitong Securities took in Hong Kong in 2009, paying HK$1.8 billion ($232 million) for a 52.86% stake in Tai Fook Securities, which later became Haitong International.
Haitong International has Rmb5.7 billion ($942 million) in RQFII quota, Rmb1.9 billion of which has been allocated to the Haitong China RMB Income Fund. It will use Rmb2 billion to launch an RQFII ETF tracking the CSI 300, which it aims to list within the next two months.