Citigroup receives Fund Custody License from Chinese Regulator
A Citigroup China operation has reportedly been awarded a domestic fund custody licence from the China Securities Regulatory Commission (CSRC).
The awarding of the license marks Citi as the first US bank to be bestowed with one, according to a Reuters report, and will allow the firm to expand its onshore presence in the country.
A number of US asset management firms are continuing to look to China despite Sino-US tensions, following on from the scrapping of foreign ownership restrictions in the nation at the beginning of 2020.
David Russell, Head of Securities Services, APAC, Citi, said: “As international fund managers, securities firms, and insurance companies set up in China, we believe they will want a trusted service provider to help them mitigate risks and reduce costs.”
BlackRock recently announced that it has also received regulatory approval from the CSRC to establish its own wholly-owned subsidiary, with firms such as Neuberger Berman and Fidelity International also submitting applications.
Christine Lam, the President and CEO of Citi China said that the bank was “proud” to be the first US firm to be granted a license, according to an article by the Financial Times, and that the reforms implemented by the Chinese government opened up “tremendous opportunities for global players to participate.”
Vanguard also recently announced that it would be looking to China, revealing that the firm was closing its Hong Kong office in favour of a regional office located in Shanghai, China’s financial capital.
The first international bank to receive a domestic fund custody license was in fact Standard Chartered, reports the Financial Times, which was grated the license in 2018.