Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Hong Kong wealth managers can’t wait for new Connect programme, with Singapore ready to pounce on city’s troubles

Cross-border Wealth Management Connect seen boosting Hong Kong fund managers like stock and bond programmes. Recent updates from HKMA suggests programme launch is imminent, sources say

China’s plan to turn the Greater Bay Area into a hub for wealth management products will help turbocharge Hong Kong’s fund industry, giving it an invaluable edge in warding off challenges from Singapore, market players said.

While Singapore is firmly entrenched in Southeast Asia, the former British colony could stake in a leading role in the broader Asian region with the opening up of the Greater Bay Area in the coming years, according to the Hong Kong Investment Funds Association (HKIFA).

“The Wealth Management Connect will expand the customer size of Hong Kong fund houses by 10 times,” Chairman Bruno Lee said in an interview with the Post. “This will be an important driving force to help Hong Kong to win over Singapore as a leading hub in Asia.”

The programme cannot come soon enough for the city whose future has been clouded by back-to-back turmoil, first from the anti-government protests last year and now the controversy over the national security law. Singapore, a perennial rival and a pillar of stability, is seen as benefiting from capital outflows from Hong Kong.

The new Connect programme will be the fourth China-Hong Kong cross-border financial plan, after the introduction of several stock and bond connections between 2014 and 2017. Mainland investors now contribute 5 to 10 per cent of daily stock transactions on the Hong Kong stock exchange, according to market data.

“These previous connect schemes have proven to be successful for their high turnover,” Lee said. “We expect the new wealth management scheme will follow the same growth pattern.”

The People’s Bank of China and financial market regulators first unveiled the proposal in 2019 and elaborated on the idea last month for a region that integrates nine southern Chinese cities with Hong Kong and Macau.

The plan seeks to reduce cross-border rules for 70 million residents in the 11 cities to access wealth products such as mutual funds amid an expected increase in the number of millionaires in a region with an estimated US$1.5 trillion (HK$11.6 trillion) in output, or as large as the Russian or South Korean economy.

Lee said the association has presented its “wish list” to the Hong Kong government. It includes allowing more than 2,000 products currently authorised by the Securities and Futures Commission to be sold to mainlanders.

“We also want to see a big quota for the whole scheme, and no cap on individual fund sales,” Lee added.

The southern Guangdong province, where the nine bay-area cities are located, has the second-highest number of mainland households with investible assets of over 6 million yuan (US$848,163), behind Beijing, according to the Hurun Institute.

The Wealth Management Connect will fuel assets under management in Hong Kong over the next decade, with global private banks and big players such as UBS and HSBC likely to tap into the bay area opportunities, according to a Bloomberg Intelligence report.

The Hong Kong Monetary Authority is working on the details of the scheme, according to the de facto central bank on its website. However, no tentative launch date has been announced.

About one-third of Hong Kong-based fund managers expect their assets under management from mainlanders to grow by 30 per cent between now and 2025, according to a survey by HKIFA and accounting firm KPMG last week.

There was US$3.25 trillion of investible wealth in Hong Kong in 2018, of which US$1.3 trillion came from cross-border sources, the Financial Services Development Council, a government body, said in February citing third-party data. The figures for Singapore were US$1.67 trillion and US$1 trillion, respectively.

As the first connect scheme for the Bay area becomes a test bed for financial integration, China may require Hong Kong-based fund managers to offer investment education and advisory services to mainlanders, said Christine Lin, a partner at consultancy firm EY.

BEA Union Investment, a Hong Kong-based fund house, is among money managers eyeing the growth potential, Chief Executive Eleanor Wan said.

“Wealth Management Connect has strategic importance for GBA to substantially increase opportunities for individual investors, industry players and talents,” she said. The programme can build on the existing strength of Hong Kong as a financial services hub, she added.




AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
×