The Japanese investment bank said it plans to enhance its presence in the onshore Chinese market by leveraging the joint venture and by acting as a gatekeeper for offshore products.
Nomura will have a majority 60% stake in the joint venture company with its other partners, which are Shanghai Lujiazui Financial Holdings, Lujiazui International Trust Company, and Shanghai Jiu You Equity Investment Fund Management, holding 20%, 10%, and 10% stakes respectively. The agreement was signed by the companies on 18 May.
It is anticipated the joint venture will commence operations in around one month’s time.
Nomura cannot market advice or products to clients directly, but the joint venture will instead provide investment advice or products to branches of financial institutions within the Shanghai FTZ who can in turn offer them to their network of clients.
On the type of financial products and advice being offered, a spokesperson said it would mainly be advice regarding global markets and asset management products.
The company also said it also aims to tap into the “high growth potential” of the China market by exploring business opportunities that arise as the country’s personal financial assets increase.
The joint venture, with an initial capital of RMB30m (JPY480m, £2.86m, $4.81m), is called Shanghai Nomura Lujiazui Investment Management Company and will be a consolidated subsidiary of Nomura Holdings.
Shanghai Lujiazui Financial Holdings is a financial holding company of Shanghai Lujiazui Development (Group) Company, which is a state-owned developer and financial holding group based in Shanghai.
Lujiazui International Trust Co., is a financial affiliate of Shanghai Lujiazui Development and Shanghai Jiu You Equity Investment Fund Management is a fund management company based in Shanghai.