Eurizon granted QFII status
Eurizon Capital, a business unit of the Intesa Sanpaolo Group, has obtained the status of Qualified Foreign Institutional Investor (QFII), allowing the company to invest directly onshore in different asset classes in the Chinese financial market through its own funds, up to a total maximum amount of USD100m.
"Eurizon is the first asset management company belonging to an Italian banking group to receive the prestigious QFII license, currently assigned to a selected and limited number of international operators. The achievement of this milestone was made possible by the Intesa Sanpaolo Group's strategic desire to continue expanding its market presence in the Chinese financial market,” says Mauro Micillo (pictured), managing director of Eurizon.
The QFII qualification permits access to the many opportunities offered by the A-Share market, where many Chinese small-cap stocks are traded, especially on the Shenzhen market. Funds may also invest directly in fixed income securities, both government and corporate, with potential for attractive returns and diversification compared with European and American markets. Exposure to the renminbi will allow investors to benefit from the continued appreciation of the currency against the US dollar.
"Eurizon maintains a positive outlook on the Chinese market, both with regard to the equities of the A-Share, as well as for the appreciation of the exchange rate,” says Micillo.
The process to obtain QFII status by Eurizon was completed in May 2013 with the allocation of a share of investment of USD100m by the State Administration of Foreign Exchange. Eurizon had already completed the first step of the procedure by obtaining a QFII license from the China Securities Regulatory Commission.
In 2012, China expanded the QFII scheme in order to encourage greater participation by foreign investors. The move is designed to promote long term growth and the stabilisation of financial markets in China.
Eurizon will invest its allocation through new sub-funds within its range of Luxembourg funds within the next six months.
In the process of selecting investments, Eurizon will make use of the advisory services of Penghua Fund Management, a leader in the Chinese asset management industry. Eurizon has been a shareholder in Penghua since 2007 with its strategic partner Guosen Securities, one of the main local financial institutions. Through this cooperation, Eurizon was one of the first companies in Europe to launch a UCITS fund Dim Sum Bond, which invests in the offshore renminbi market.
- Special Reports