MUFG Unit 1st Japan Bank To Invest In China Asset Management
07.09.10, 13:55 Uhr
TOKYO -(Dow Jones)- Mitsubishi UFJ Trust and Banking Corp. said Tuesday it has signed an agreement with BNP Paribas Asset Management PLC to buy its entire 33% stake in an asset management joint venture with Shenyin & Wanguo Securities.
The move marks the first time that a Japanese bank has invested in a asset management firm in China, where appetite for investing in mutual funds among individuals is growing rapidly and corporate pension funds are likely expand in the near future.
The trust banking unit of Mitsubishi UFJ Financial Group Inc. (8306.TO) said it has also signed an agreement with Shenyin & Wanguo Securities over the stake purchase. The Chinese securities firm will retain the remaining 67% stake in the joint venture, which is called SYWG BNP Paribas Asset Management. The asset management firm markets its products through the Industrial and Commercial Bank of China.
While the value of the deal value wasn't disclosed, a person familiar with the matter estimated it to be around it to be around $100 million.
The trust banking unit of Japan's largest bank will seek approval from Chinese regulators this month.
Japanese financial institutions like Mitsubishi UFJ Trust are seeking further growth overseas as many firms are having a tough time generating profits at home as the country's population ages and shrinks.
In 2008, Mitsubishi UFJ Trust bought a 9.9% stake in Aberdeen Asset Management PLC for Y20 billion. It now holds a more than 15% stake in the U.K. asset management firm.
While the Chinese market is very attractive given its potential growth in terms of investment activities, hurdles for foreign firms still remain.
Chinese regulations that allow foreign investors to own a stake in only one mutual-fund joint venture forced BNP Paribas to sell its stake in two of three Chinese mutual-fund companies this year.
The French bank formed the 33-67 fund venture with Shenyin Wanguo Securities Co. in 2004. It subsequently accumulated stakes in ABN Amro TEDA Fund Management Co. and Fortis Haitong Investment Management Co. as a result of the consolidation of Europe's financial sector amid the global financial crisis.
In March, BNP Paribas completed the sale of a 49% stake in ABN Amro TEDA Fund to Canadian financial services group Manulife Financial Corp. for $156 million.
The trust banking unit of Mitsubishi UFJ Financial Group Inc. (8306.TO) said it has also signed an agreement with Shenyin & Wanguo Securities over the stake purchase. The Chinese securities firm will retain the remaining 67% stake in the joint venture, which is called SYWG BNP Paribas Asset Management. The asset management firm markets its products through the Industrial and Commercial Bank of China.
While the value of the deal value wasn't disclosed, a person familiar with the matter estimated it to be around it to be around $100 million.
The trust banking unit of Japan's largest bank will seek approval from Chinese regulators this month.
Japanese financial institutions like Mitsubishi UFJ Trust are seeking further growth overseas as many firms are having a tough time generating profits at home as the country's population ages and shrinks.
In 2008, Mitsubishi UFJ Trust bought a 9.9% stake in Aberdeen Asset Management PLC for Y20 billion. It now holds a more than 15% stake in the U.K. asset management firm.
While the Chinese market is very attractive given its potential growth in terms of investment activities, hurdles for foreign firms still remain.
Chinese regulations that allow foreign investors to own a stake in only one mutual-fund joint venture forced BNP Paribas to sell its stake in two of three Chinese mutual-fund companies this year.
The French bank formed the 33-67 fund venture with Shenyin Wanguo Securities Co. in 2004. It subsequently accumulated stakes in ABN Amro TEDA Fund Management Co. and Fortis Haitong Investment Management Co. as a result of the consolidation of Europe's financial sector amid the global financial crisis.
In March, BNP Paribas completed the sale of a 49% stake in ABN Amro TEDA Fund to Canadian financial services group Manulife Financial Corp. for $156 million.
DJG/dok
