South Korea's Hanwha Investment Trust Management has awarded the local custody mandate for funds that trade in China under its new Qualified Foreign Institutional Investor (QFII) status to Citi.
Citi Securities and Fund Services will provide the South Korean asset manager with both local custody services in China and trustee services in South Korea. Under the terms of the mandate, Hanwha will receive relevant information gathering, knowledge transfer, market access, and relationship and networking in China.
"In providing us both domestic trustee services in Korea and local custody capabilities in China, Citi provided us a suite of services that ideally complemented the preparation for our latest QFII fund launch," says Chul-Hoon Kim, Hanwha Investment's CEO. "We are pleased to partner with Citi and look forward to working closely on this important investment in China."
Under South Korean law, all locally domiciled funds must retain a trustee.
Hanwha's application for QFII status was approved on March 10 along with US-based Emerging Markets Management and DWS Investment -- the South African arm of Germany-based DWS Investment.
Launched in 2003, QFII is a scheme governed by China's Securities Regulatory Commission that allows foreign investors to buy Chinese securities on the country's exchanges in Shanghai and Shenzhen. With March's announcement, 79 investors have been approved under the scheme.
Citi hopes to expand its relationship with other Korean asset managers applying for QFII approval.