HSBC Jintrust Fund Management Company Limited (HSBC Jintrust) has launched an on-shore RMB money market fund in mainland China.
The Fund raised RMB1.16 billion (USD178 million) during the IPO period from 10 to 28 October 2011 and is the second triple-A rated money market fund in China. The Fund aims to achieve a relatively stable return from a wide range of liquid money market instruments in the local market.
Steve Lee, Chief Executive Officer of HSBC Jintrust Fund Management Company, says: “Given that the RMB is a highly regulated currency, a large amount of RMB assets held by multi-national corporations in China are increasingly looking for better investment alternatives. With an expectation of currency appreciation and a growing need to retain surpluses onshore for business activities, we believe money market funds are a viable choice offering diversification of counterparty risk, high liquidity, and competitive yields at a relatively low cost.”
Managed by the local investment team of HSBC Jintrust, the Fund will follow the same investment process and high standards as prescribed for HSBC Global Asset Management’s global liquidity portfolios, which prioritise risk management, liquidity and yield. HSBC Global Asset Management is one of the world’s largest liquidity fund
managers with around US$100 billion of assets under management in this asset class and more than 20 years of relevant experience. The Fund is part of the firm’s commitment to provide the best RMB solutions to its investors worldwide.
Jackling Zhong, fund manager for the HSBC Jintrust RMB Money Market Fund, adds: “We think money market funds will continue to benefit from government policy, which supports a high interest rate environment. Our Fund aims to achieve an AAA rating with a rate of return comparable to the RMB seven-day call deposit rate and daily access. Money market funds currently account for five per cent, or RMB118 billion of the fund industry in China, and we expect to see continued growth in this asset class in China.