Citic, CICC among 10 brokerages included in China's Greater Bay Area wealth scheme, sources say

China Mobile

20/08/2024 12:20

By Selena  Li and Xie Yu
       HONG KONG, Aug 20 (Reuters) - China and Hong Kong are
set to expand a pilot wealth scheme that allows residents to
invest cross-border by adding the first batch of 10 securities
firms, including the countries' largest brokerages, two people
with direct knowledge told Reuters.
    The 10 securities companies include Hong Kong-listed China
CITIC Securities  6030.HK , China International Corporation
Company (CICC)  3908.HK , Huatai Securities  6886.HK  and GF
Securities  1776.HK , according to the people.
    China Merchants Securities  600999.SS , PingAn Securities,
Guotai Junan Securities  601211.SS , Guosen Securities
 002736.SZ , Guotou Securities and Zhongtai Securities
 600918.SS  are also in the first batch, the sources said, who
declined to be named as they were not authorised to speak to
media. 
    The China Securities Regulatory Commission and Hong Kong
Securities and Futures Commission did not immediately respond to
Reuters' request for comment.
        Guotou Securities could not be reached immediately for
comment, while the other nine did not immediately respond to
Reuters queries.  
  
    The new entrants to the cross-boundary scheme are set to
benefit from rising demand from Chinese investors seeking
offshore investments as domestic assets have been weighed down
by a slowing economy and volatile markets. 
    Launched in late 2021,  the so-called "wealth connect"
scheme allows residents of nine cities in the southern province
of Guangdong, which borders Hong Kong, to buy investment
products sold by banks in Hong Kong and Macau, while allowing
residents of the two offshore centres to do the same in the
world's second-largest economy.
    Expanding the scheme will mean China's more sophisticated
securities investors in the wealthy region are given an
additional channel to invest offshore, gaining new access under
China's strict capital control with outbound investing schemes
increasingly facing a quota crunch.
    Mainland investors have so far invested 15.4 billion yuan 
($2.16 billion) in offshore products under the scheme, compared
with 24.6 million yuan Hong Kong and Macau residents invested
northbound, according to data from China's central bank.
    The scheme has seen a significant surge in investment from 
mainland clients to the offshore hubs this year, according to
official data, as wealthy Chinese try to shield returns from a
domestic economic and property sector downturn and a weaker
Chinese yuan. 
    China's A-shares' turnover last week hit the lowest level
since May 2020, with only 496 billion yuan ($69 billion) in
volume traded in the session.
    A total of 24 Hong Kong-based banks are eligible to serve
southbound investments by mainland residents, while mainland
regulators have approved 27 banks to serve northbound
investments by Hong Kong and Macau-based investors. 
    
    



($1 = 7.1437 Chinese yuan renminbi)

 (Reporting by Selena Li and Xie Yu, Editing by Louise Heavens)
 ((Selena.Li@thomsonreuters.com; +852 39525868;))