After launching China’s first-ever public mutual fund managed by a foreign asset manager last year, Blackrock has risen to the top of China’s latest “power rankings” compiled by Broadridge.
The Blackrock China New Horizon Mixed Securities Investment Fund has raised more than $1 billion in assets, according to Broadridge, a global fintech company.
“More recently, Blackrock’s wealth management joint venture in China was granted approval to roll out pension wealth management products,” said Yoon Ng, director of distribution at Broadridge.
“All of these developments, coupled with an improved brand score, helped Blackrock break the three-way tie and retain first place on their own.”
Strong inbound demand for fixed income products in China also helped Blackrock’s offshore assets under management in China continue to grow in the second half of 2021, while its peers mostly saw their assets decline, the fintech company said.
When deciding the power ranking, Broadridge considers six key criteria, including Chinese fund AUM, breadth of business reach, local operational strength, brand perception, strength of global investment and assigning China as a strategic priority.
The scores of the six criteria are weighted and counted to determine the best-positioned foreign manager in the market.
JPMAM and UBS AM, which tied with Blackrock at the top of the October 2021 chart, fell one and two spots respectively.
China Power Ranking – Top 10 Global Managers
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The Chinese powerhouse rankings are featured in the semi-annual Navigator report, where Broadridge also identifies opportunities in private equity (PE) and venture capital (VC), and retail retirement for global managers.
Although the bulk of China’s private market AUM is in private equity funds, venture capital funds grew faster than the former, according to the report.
Assets under management for the venture capital industry grew at a compound annual growth rate of 38% between 2017 and 2021, compared to a CAGR of 13% for private equity funds over the same period.
Private equity funds, on the other hand, exceeded RMB 10.5 billion ($1.7 billion) in assets at the end of last year.
Combined with regulatory guidelines in 2018, stronger support from institutional investors and greater opportunities for secondary fundraising, Broadridge believes there will be more opportunities for overseas players using the qualified foreign limited partnership route. .
Retail pension products, also known as “third pillar pensions”, mainly offered by insurers and banks, are also likely to provide more opportunities for global managers in China, Broadridge noted.
China’s third-pillar pensions currently account for about 10 percent or RMB 1.2 billion of the total pension market, but the vast majority of them have been tightly defined and regulated, Ng said.
Since a regulatory framework for third-pillar pensions was established in 2018, regulated products represent only around 1% of the total repo market, providing emerging opportunities for global asset managers, Broadridge said.
The fintech company expects China’s private pension to become a RMB 3 trillion industry by 2030.