Wall Street’s China Entry Just Got Harder (Again)
Banks are now required to spin off their wealth-management products into subsidiaries. That means even more competition for foreign players.
Don’t bank on it.
Photographer: Qilai Shen/BloombergThe world’s fund managers just can’t seem to catch a break.
Pressured by everything from cheap passive funds to burdensome regulations, big asset managers have been pinning their future on China’s growing $15 trillion fund industry. And for a while there, things looked pretty good. Beijing was cracking down on wealth-management products, whose eye-popping returns had propelled erstwhile rivals in the shadow-banking sector. Officials even permitted foreign fund managers and investment banks to control their China joint ventures. Many now await approval for their applications, which they were allowed to submit in April.