JPMorgan takes top spot from UBS in Broadridge’s China Power Ranking
JPMorgan more than doubled its offshore China assets under management (AUM) in the second half of 2020, helping to push the firm to the top of Broadridge’s China Power Ranking.
While UBS and 3rd-ranked BlackRock led in offshore China AUM size and showed spectacular 50 per cent and 90 per cent AUM growth over the period, respectively, JPMorgan’s result translated into a proportionally higher increase in Broadridge’s China AUM score compared to its two close rivals.
JPMorgan also reinforced its lead in brand perception, ranking No.1 in both Broadridge’s proprietary retail investor survey and professional fund buyers’ interviews. A further push came from a recent acquisition. “JPMorgan’s rise to the top of our rankings, albeit with a minimal lead, was also helped by its 10 percent stake purchase in China Merchants Bank’s wealth unit,” says Yoon Ng, Broadridge’s Senior Director APAC Insights.
These are some of the key findings presented in the Broadridge’s Navigator China Bi-annual Report, Edition 1 – 2021. Broadridge’s China Power Ranking takes into account six key criteria across three different time horizons - current, near term and long term. These criteria are: China fund AUM, extent of business scope, local operational strength, brand perception, global investment strength and China as a priority. Scores across all six criteria are tallied to determine the foreign manager that is best positioned in the market. Broadridge currently tracks 73 asset managers with a combined USD64 trillion in global AUM.
Broadridge notes that competition at the top remains intense, with UBS reported to be applying for mutual recognition of funds (MRF) approval to sell three of its Hong Kong-domiciled funds in the Mainland. “If the firm receives authorization in the coming months, UBS could take back the leading position, assuming there are no other major moves from JPMorgan during the same time period,” adds Ng.
Other foreign managers have also caught the eye in the China Power Ranking. For instance, Allianz Global Investors made significant progress in 2020, rising four spots to take 6th position. It doubled its China offshore AUM during the second half of 2020 and improved its brand score. The firm has also benefited from its parent’s deep involvement in the China business. In early 2021, the German insurance giant obtained approval to set up China’s first wholly foreign-owned insurance asset management company.
Meanwhile, French manager Amundi has ramped up its efforts to grow its China business. Its majority-owned wealth management joint venture (JV) with BOC WM, Huihua Wealth Management, has launched more than 20 wealth management products (WMPs) since December 2020 and raised about USD1.2 billion in assets. “Despite the majority foreign ownership, the JV has been actively adopting localization by hiring local leadership and investment professionals. Notably, the local team have senior members with JV experiences and overseas background, which helps with better cultural understanding,” notes Ng.
In addition to Broadridge’s proprietary China Power Ranking, this edition of the report also features how asset managers can navigate the dynamic USD4 trillion Chinese bank WMP landscape, the largest segment in China’s asset and wealth management, which is expected to grow at 10.2 per cent over the next five years after a regulatory shakeup. The report also taps the latest iteration of Broadridge’s exclusive APAC Fund Buyer Focus to highlight the top selection criteria of fund buyers in China as well as the top-10 most recognised firms in the country.