| HONG KONG
HONG KONG Nov 13 After "dim sum" bonds and
offshore yuan deposits in Hong Kong, now comes the turn of
yuan-denominated units in mutual funds.
European money manager Amundi Asset Management and DBS Bank
are leading the way with renminbi-denominated units in
their funds, providing a new investment channel to investors
holding the Chinese currency.
Making a yuan share class available on funds whose
underlying assets are not denominated in the Chinese currency
encourages international use of the yuan and also opens up a
potential lucrative investor base for these funds.
"We see the demand increasing for yuan investments both from
institutional and retail investors," said Zhong Xiaofeng, Chief
Executive Officer of Amundi North Asia.
The yuan share class in Amundi's newly-launched equity
dividend fund will invest in stocks in the Asia-Pacific region.
DBS Bank (Hong Kong) said last week it had launched the
RMB-hedged share class of the Schroder Asian Asset Income Fund,
providing investors access to an Asian-centric asset allocation.
As China prepares to promote the numerous free trade zones
on the mainland to boost global use of its currency, Hong Kong
is making efforts to launch new products to keep its edge intact
while promoting itself as a global money management hub.
Growing dim sum bonds, named after the bite-size delicacies
served in Hong Kong teahouses, saw not only the first issue from
a foreign regional government, but a debut of a floating-rate
bond with reference to the newly-launched CNH Hibor this month.
"Hong Kong needs to be able to provide more asset classes
for RMB investors and if it doesn't, I think Hong Kong is going
to lose comparative advantages," said Ayaz Ebrahim, chief
investment officer, Asia ex-Japan equities of Amundi Hong Kong.
The size of Hong Kong's offshore yuan bond market is about
293 billion yuan ($48.10 billion) and the amount of yuan
deposits in Hong Kong banks was 730 billion yuan at the end of
September, latest data from the Hong Kong Monetary Authority