CIMB obtains RQFII licence, access to China’s capital markets

The licence was recently awarded to CIMB-Principal by the China Securities Regulatory Commission. — Reuters pic
The licence was recently awarded to CIMB-Principal by the China Securities Regulatory Commission. — Reuters pic

KUALA LUMPUR, March 5 — CIMB-Principal Asset Management Bhd has become the first asset management company in Malaysia to obtain the Renminbi Qualified Foreign Institutional Investor (RQFII) licence, which gives it direct access to China's capital markets.

The licence was recently awarded to CIMB-Principal by the China Securities Regulatory Commission.

Chief Executive Officer, Munirah Khairuddin, said: "With the RQFII licence, we will have direct access to China’s capital markets and invest in the hitherto inaccessible products such as the A-shares and bonds of China entities."

CIMB-Principal plans to develop and introduce more innovative products that invest in China's onshore securities, as well as diversify some existing investment portfolios directly into China’s onshore equities and fixed income securities.

"This, I believe, will definitely add value to our customer proposition for both Malaysian and international clients," she said in a statement here today.

CIMB-Principal has appointed HSBC (M) Trustee Bhd as trustee, The Hongkong and Shanghai Banking Corp Ltd as global custodian and HSBC Bank (China) Co Ltd (HSBC) as its China RQFII custodian.

As the onshore custodian bank in China, HSBC facilitated CIMB-Principal’s application for the first Malaysia RQFII licence, demonstrating its continued leadership in helping global investors access the Chinese securities markets.

Mukhtar Hussain, Chief Executive Officer of HSBC Malaysia, said the bank was proud to be appointed the custodian bank for Malaysia’s first RQFII.

"The size of the RQFII quota granted to Malaysia is further evidence of China’s commitment to granting investors greater access to its markets. We are confident this will be the first of many investments flowing through the China-Malaysia business corridor, which is growing in importance every year," he said.

He said HSBC has a number of firsts in servicing institutional investors in China.

"We are delighted to add another notch to our already"stellar track record," he said.

In November 2015, China extended the RQFII programme to Malaysia with an initial RQFII quota of RMB50 billion (RM32.2 billion).

This makes Malaysia the 14th overseas jurisdiction to be included in the RQFII programme, which has already embraced markets such as South Korea, Singapore and the United Kingdom. — Bernama