BlackRock Asset Management North Asia, a subsidiary of BlackRock, has received its first renminbi Qualified Foreign Institutional Investor (RQFII) license from the China Securities Regulatory Commission.
The license allows the asset manager to invest in the domestic capital markets in China, including the A-share equity and onshore bond markets, BlackRock said, adding that it will apply for investment quotas under the license from the State Administration of Foreign Exchange.
Marc Desmidt, head of strategic product management for Asia Pacific said: “China is an important investment destination for our clients globally as it undergoes a pivotal transformation, and gradually internationalises its capital markets.
“The award of our first RQFII license complements our two QFII licenses and is recognition by the China Securities Regulatory Commission of our commitment to growing the BlackRock China business. We look forward to the award adding to the investment solutions we offer our clients.”
BlackRock received its first QFII license for its subsidiary, BlackRock Institutional Trust Company with an investment quota of US$100m in June 2012. It was then awarded a second QFII license in October 2012, receiving an additional investment quota of US$100m in March 2013.
China is bringing in measures to internationalise the RMB, taking the pilot RQFII programme beyond Hong Kong to markets such as London, Singapore, and Taiwan.
In October, China allocated RMB80bn ($16bn, £8bn) for London-based firms and RMB50bn for Singapore-based organisations.
As a further step to boost the RMB, the financial regulators of Hong Kong and China last week also entered into an agreement to start a mutual stock market access programme
within six months that will allow investors in both countries to participate in each other’s stock markets. Also, deliberations are ongoing for the "mutual recognition" of funds between mainland China and Hong Kong.
Meanwhile, fund houses are also trying to tap into demand for RMB products, with J.P. Morgan Asset Management
recently announcing a new RMB share class to its multi-income fund, having introduced a similar share class in its Asia equity dividend fund earlier in March. Hong Kong-based HFT Investment Management also recently unveiled a RMB money market fund.
BlackRock, with $4trn worth of assets under management, recently reshuffled the management of a number of its top portfolios, a move which will see Ryan Stork take over as manager of its Asia Pacific operations from 1 June.
Mark McCombe, who is the current Asia Pacific chairman, has been named as global head of the institutional client business and chairman of BlackRock Alternative Investors, based in New York.
McCombe will continue to serve as Asia Pacific chairman until the end of 2014. This will facilitate a smooth leadership transition for Stork who will assume the chairman role at the end of the year. McCombe succeeds Rob Goldstein as head of the institutional client business following Goldstein’s appointment as BlackRock’s chief operating officer.