| 1 March 2024, Friday |

BNP Paribas gets regulatory nod to set up China asset management joint venture

According to the two firms, BNP Paribas has acquired Chinese regulatory clearance to begin developing an asset management joint with Agricultural Bank of China, allowing the French giant to enter a $4 trillion industry.

According to an AgBank stock exchange announcement late Monday, the China Banking and Insurance Regulatory Commission has granted preliminary clearance for BNP and AgBank, China’s third-largest lender by assets, to launch a new joint venture.

BNP confirmed the preliminary clearance, which came in the form of the CBIRC formally confirming the two businesses’ application for a final license to operate in the market.

The French corporation will control 51% of the venture, with the remainder held by state-owned AgBank.

According to Reuters, BNP’s asset management arm is in negotiations with an AgBank affiliate to launch a wealth management business, taking advantage of China’s opening of its financial markets to foreigners.

BNP Paribas Asset Management and ABC Wealth Management, a wealth arm of AgBank, will fund the new platform, according to Monday’s filing.

Since China deregulated financial markets in 2019, allowing foreign asset managers to set up majority-owned ventures with local banks, a flurry of foreign firms including BlackRock and Amundi have launched majority-controlled units locally.

Other foreign firms such as Barclays and Allianz are also exploring this and trying to find local partners.

  • Reuters