Chinese authorities have granted permission to Fidelity International and JPMorgan Asset Management to distribute funds on the mainland under the Mutual Recognition of Funds (MRF) scheme, reported Reuters citing local media.
Fidelity International received approval to sell its Global Investment Fund – Hong Kong Bond Fund to investors in mainland China.
The company noted that this would provide mainland clients with additional access to global investment opportunities, the news publication added.
JPMorgan Asset Management also secured regulatory clearance for a product under the MRF arrangement. Details of the specific JPMorgan fund were not disclosed.
The approvals from the securities regulator came as China’s central bank implemented measures aimed at curbing the yuan’s appreciation, such as encouraging forward market dollar purchases.
Although it is unclear whether the fund decisions were part of efforts to influence currency trends, Chinese authorities have previously utilised outbound investment quotas to manage capital flows and expectations in foreign exchange markets.
Local media first reported that regulators had approved four products under the MRF scheme in one round.
The MRF allows certain funds based in Hong Kong and mainland China to be offered cross-border, subject to regulatory consent.
Fidelity International China general manager James Sun said: “With the continued progress of RMB internationalisation and the growing appetite among Chinese investors for global asset allocation, cross-border investment is becoming an increasingly important component of household portfolios.”
“China greenlights cross-border funds for Fidelity and JPMorgan AM – report” was originally created and published by Private Banker International, a GlobalData owned brand.
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