By Tony Munroe and Charlie Zhu
SHANGHAI (Reuters) - A Chinese fund management joint venture co-owned by Fortis (FOR.BR: Quote, Profile, Research, Stock Buzz)(FOR.AS: Quote, Profile, Research, Stock Buzz) expects its maiden fund enabling mainland Chinese to invest overseas to hold assets of at least $500 million, the head of the venture said on Wednesday.
Tian Rencan, chief executive of Fortis Haitong Investment Management, also said he expected the joint venture to begin advising a new fund focusing on overseas-listed Chinese companies that would be sold through a partner to Japanese investors.
That fund would be similar to an offering through a South Korean partner early this year, and could be followed by launches elsewhere in Asia, such as Singapore and Hong Kong, Tian said.
Fortis Haitong is among a handful of Chinese fund management firms with preliminary clearance to sell products holding overseas stocks to mainland Chinese under the Qualified Domestic Institutional Investor (QDII) scheme.
Tian said he was confident that Fortis Haitong could secure an adequate foreign exchange quota from Beijing for investing in overseas stocks, given China's wish to promote capital outflows.
"I do not foresee any trouble in getting the quota, because if you understand the macro picture, we have to balance the inflow with the outflow," Tian said at the Reuters China Century Summit in Shanghai. "We need to encourage some money to go out."
As for the potential size of Fortis Haitong's QDII fund, Tian said: "I personally do think that a minimum US$500 million should be OK. Why not $1 billion? Everything is possible."
A rival fund manager, China Southern Fund Management, became the first to unveil its QDII plans when it said on Monday it would launch a fund next week. Continued...
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