SHANGHAI, May 3 (Reuters) - The combined size of China’s money market funds shrank by 6 percent in March from February, suggesting regulators’ efforts to rein in the sector’s feverish growth has started to show results.
The monthly fall follows a doubling in net assets during the previous year, which prompted regulators to impose curbs amid concerns that rapid growth in some money market funds could lead to systemic risks in case of massive redemptions.
China’s money market funds swelled to 7.81 trillion yuan ($1.23 trillion) at the end of February, but fell to 7.32 trillion yuan at the end of March, according to the Asset Management Association of China, underlining the impact of government intervention.
The government published rules last year to tighten liquidity management in the mutual funds industry, and guided individual funds, including Ant Financial’s money market fund Yu’e Bao, to place daily caps on subscription volumes.
Yu’e Bao, the country’s largest money market fund, saw its net assets jump more than 40 percent to 1.69 trillion yuan during the first quarter.
$1 = 6.3610 Chinese yuan Reporting by Samuel Shen and John Ruwitch Editing by Jacqueline Wong