Laiyuan 2 1 Century Business Herald
Gu Yue, New, Recording.
On the afternoon of June 29th, the People's Bank of China, Hong Kong Monetary Authority and Macau Monetary Authority announced the contents of the pilot project of "Cross-border Wealth Management Link" in Guangdong-Hong Kong-Macao Greater Bay Area. Guangdong-Hong Kong-Macao Greater Bay Area residents can personally invest in wealth management products sold by banks in cross-border investment zones.
The statement pointed out that the cross-border capital flow will be managed by the total amount and the individual investor quota, and the total amount will be dynamically adjusted through the macro-prudential coefficient, but the north and south quotas that have not been announced in the market are 654.38+050 billion yuan respectively.
Previously, on May 14, the People's Bank of China, the China Banking Regulatory Commission, the China Securities Regulatory Commission and the Foreign Exchange Bureau issued the Opinions on Financial Support for Guangdong-Hong Kong-Macao Greater Bay Area's Construction, which proposed 26 specific measures from five aspects: promoting Guangdong-Hong Kong-Macao Greater Bay Area's cross-border trade, facilitating investment and financing, expanding the financial industry's opening to the outside world, promoting the interconnection of financial markets and financial infrastructure, improving Guangdong-Hong Kong-Macao Greater Bay Area's financial service innovation level, and effectively preventing cross-border financial risks. This "cross-border financial management pilot" business is a concrete implementation of Article 26 "Support Guangdong-Hong Kong-Macao Greater Bay Area mainland residents to purchase financial products sold by Hong Kong and Macao banks through Hong Kong and Macao banks, and Hong Kong and Macao residents to purchase financial products sold by mainland banks through Guangdong-Hong Kong-Macao Greater Bay Area mainland banks".
Details are as follows:
1. "Cross-border wealth management link" refers to the wealth management products that Guangdong-Hong Kong-Macao Greater Bay Area residents cross-border to invest in Guangdong-Hong Kong-Macao Greater Bay Area Bank, which can be divided into "southbound link" and "northbound link" according to the identity of buyers. "Southbound access" means that mainland residents in Guangdong-Hong Kong-Macao Greater Bay Area purchase qualified investment products sold by banks in Hong Kong and Macao by opening investment accounts in them; "Northbound Link" means that Hong Kong and Macao residents open investment accounts in mainland banks in Guangdong-Hong Kong-Macao Greater Bay Area (hereinafter referred to as mainland banks) to purchase qualified wealth management products sold by mainland banks.
Second, "cross-border wealth management link" is an important measure for the state to support the construction of Guangdong-Hong Kong-Macao Greater Bay Area and promote financial cooperation between the Mainland, Hong Kong and Macao, which is conducive to creating a high-quality living circle in Guangdong, Hong Kong and Macao, facilitating cross-border investment by individual Guangdong-Hong Kong-Macao Greater Bay Area residents, promoting the opening up of China's financial market and promoting the social and economic development of the Mainland, Hong Kong and Macao.
Three. "Cross-border wealth management" follows the relevant laws and regulations on the management of personal wealth management products in the three places, while respecting international practices. The qualification, investment mode, investment product range, investor rights protection, dispute settlement and other matters of investors of "Northbound Connect" and "Southbound Connect" shall be determined through consultation by the People's Bank of China, China Banking Regulatory Commission, China Securities Regulatory Commission, foreign exchange bureau, Hong Kong Monetary Authority, Hong Kong Securities Regulatory Commission and Macao Monetary Authority. "Northbound" and "Southbound" business funds are bound by accounts to realize closed-loop remittance and closed management, and the scope of use is limited to the purchase of qualified investment products. Renminbi is used for cross-border settlement of capital remittance, and capital exchange is completed in offshore market. The cross-border capital flows of "Beitong" and "Nantong" are managed by total amount and individual investor quota, and the total amount is dynamically adjusted through macro-prudential coefficient.
4. Relevant regulatory authorities in Hong Kong, Macao and the Mainland will each take all necessary measures to ensure that both sides establish an effective mechanism under the "Cross-border Wealth Management Link" to protect the interests of investors and respond to illegal acts in a timely manner according to the principle of territorial management. Relevant regulatory authorities in Hong Kong, Macao and the Mainland will sign a memorandum on regulatory cooperation, establish and improve regulatory cooperation arrangements and liaison and consultation mechanisms to protect the interests of investors and establish a fair trading order.
Five, the mainland infrastructure institutions should be in accordance with the principle of safe and orderly, risk controllable, actively promote the preparatory work of "cross-border financial management", after completing the construction of relevant rules and systems, officially launched the "cross-border financial management" pilot business.
"The launch of cross-border wealth management shows that China has further opened up its capital account convertibility. From the specific mode of operation, it is particularly mentioned that quota management and closed management are implemented, capital exchange is completed in the offshore market, and investment products are restricted. It is also hoped that these methods can prevent large-scale fluctuations in cross-border capital flows and prevent the risk of fluctuations in exchange rates and foreign exchange markets. Judging from the current scale of the offshore market in Hong Kong, it is expected that the total amount of early financial management will not be too large. " An analyst in the foreign exchange field of a brokerage in Beijing said.
"Among the 26 measures previously announced, cross-border wealth management business is particularly concerned by the market. It is a measure to benefit the people, which is not only conducive to financial institutions to explore the market of wealth management products, but also gives citizens more choices of wealth management products and optimizes asset allocation. " Zhang Guangnan, a professor at the Guangdong-Hong Kong-Macao Development Research Institute of Sun Yat-sen University, said, "In addition, Greater Bay Area's financial opening business, including cross-border wealth management, was designed with market development in mind, as well as regulatory safety and prudence. The next problem to be solved is the docking of industry standards, the coordinated interpretation of financial-related regulatory laws, and the coordinated development of local governments combined with their respective characteristics in Guangdong-Hong Kong-Macao Greater Bay Area. "
On the same day, official website, the Hong Kong Monetary Authority, issued a press release. The Macao Monetary Authority also issued a press release saying that it welcomed the pilot project of "cross-border wealth management" in Guangdong-Hong Kong-Macao Greater Bay Area, believing that it would bring new development opportunities for Macao's financial industry and provide more choices for Macao residents' wealth management and investment service needs. The wealth management mechanism allows residents to purchase cross-border wealth management products through the banking system, which broadens the wealth management channels of Bay Area residents including Macao, facilitates individual cross-border investment activities, helps to increase the cross-border flow and use of RMB, and brings new business opportunities to banks.
The Macao Monetary Authority will follow up the relevant preparations, including negotiating with the mainland regulatory authorities on the specific implementation details and arrangements of the Cross-border Wealth Management Link, signing a memorandum of regulatory cooperation, establishing an effective regulatory coordination and communication mechanism to prevent risks, and working with the industry to promote the implementation of this brand-new business as soon as possible.
Image source/Macau Monetary Authority
It is reported that "Licaitong" will operate in a closed channel, and the funds will come back and forth the same, which may not affect the daily remittance ceiling. From the perspective of product types, at first it was mainly a simple wealth management product. HKMA's early research hopes that these products are low-risk and issued by local banks, rather than third-party wealth management products.
The original product was "low risk and relatively simple"
On June 29th, Yue Minhong, president of the Hong Kong Monetary Authority, said that the preliminary work of the exploration and research in the three places had been basically completed, and Licaitong had entered the stage of formulating implementation rules, which was a big step towards formal opening.
He said that the breakthrough of Licaitong lies in providing a formal and convenient channel, allowing retail investors to directly open and operate investment accounts across borders for the first time, and having greater autonomy in choosing wealth management products.
Following the experience of stock connect and debt connect in the past, in the initial stage of wealth management, the regulatory agencies of the three places will adopt a pragmatic and prudent attitude to design all links. This is reflected in the implementation framework of Licaitong, including the product range mainly covering low-risk and relatively simple investment products; Investors set up remittance and investment accounts in banks in the two places, and implement one-to-one binding; Cross-border RMB funds are subject to closed-loop remittance and quota management.
"Just like other interconnection mechanisms, we strive for wealth management to take the first step steadily as soon as possible, instead of pursuing one step at a time. After all, the different regulatory systems in the three places are a new attempt for most participating institutions and investors. " Raymond Yue said.
He said, "In the next few months, we will discuss the implementation details with the regulatory authorities of the two places, and we will also listen to the opinions of the industry, hoping to start Licaitong as soon as possible."
In addition, Wealth Management aims to give investors more freedom in investment decision-making, and for many investors, this will be their first "cross-border test", so it is particularly important to do a good job in investor protection.
Licaitong will open up a huge customer source and business development space for the financial industry in Hong Kong, promote the organic growth of the local wealth management business market, drive the development of the entire financial industry chain such as product sales, asset management and product development, and will also benefit related professional service sectors. In addition, Licaitong has expanded the hinterland of Hong Kong's wealth management industry, provided more incentives for international financial institutions to set up offices in Hong Kong and invest more resources to serve mainland investors, and further consolidated its position as an international financial center and a global offshore RMB business hub.
All walks of life in Hong Kong responded positively.
The Government of the Hong Kong Special Administrative Region has indicated that it welcomes the pilot of two-way cross-border wealth management services in Guangdong-Hong Kong-Macao Greater Bay Area, so that residents including nine cities of Hong Kong, Macau and Guangdong can invest in wealth management products sold by banks in the region.
Carrie Lam Cheng Yuet-ngor, Chief Executive of the Hong Kong Special Administrative Region, said that the launch of Licaitong fully reflects the central government's great attention and support for Greater Bay Area's financial development, and shows the solid backing of the state for Hong Kong, which will continue to play a leading role in the country's economic development and financial market opening.
She pointed out that national security legislation will restore stability, the rule of law and a good business environment, ensure the confidence of investors, and further consolidate and enhance the status of an international financial center.
Chen Maobo, the Financial Secretary of Hong Kong, pointed out that wealth management has brought huge business opportunities to the entire financial industry chain and other professional services in Hong Kong, opened up a broader market for the financial industries in the three places, provided Greater Bay Area residents with more choices of wealth management products, promoted the cross-border circulation and use of RMB, and further consolidated Hong Kong's position as a global offshore RMB business hub.
He said that Licaitong provided greater incentives for international financial institutions in order to base itself on Hong Kong, invest more resources to serve a large number of investors in Greater Bay Area cities, and strengthen Hong Kong's role as an international asset management center and an important bridge for capital to enter and leave the Mainland.
Yue Minhong, president of the Hong Kong Monetary Authority, said: "The two-way cross-border wealth management link is another important milestone in the opening of the mainland capital account after the stock and bond links between the two places. It is a major breakthrough in promoting the development of offshore RMB business in Hong Kong and a highlight in deepening financial cooperation. Greater Bay Area residents' demand for cross-border wealth management investment is growing day by day, and the financial industries in both places have great expectations for wealth management. The launch of Licaitong proves the strategic advantage of Hong Kong financial institutions in participating in the financial opening-up in the Mainland and serving the asset management needs of residents in the two places. We will fully cooperate with the Hong Kong Securities Regulatory Commission and relevant mainland authorities, and in close consultation with the industry according to the framework announced today, finalize the implementation details as soon as possible, and strive to launch Licaitong as soon as possible. "
At the same time, the Hong Kong banking industry welcomes the progress made in wealth management. Zhuo, Risk Director of BOC Hong Kong, told the media on June 29th that the bank has been following up on financial matters, which I believe will bring great opportunities to the banking industry in the two places, and customers in the two places will also have more investment and financial management opportunities.
He revealed that BOC Group has also made a lot of discussions on promoting related businesses, especially on business model, risk compliance and investor protection, and has also put forward many opinions to regulators, hoping to launch them as soon as possible.
Hong Pizheng, Chief Executive Officer of Standard Chartered Bank Greater China and North Asia and Chief Executive Officer of Group Retail Banking and Wealth Management, said:
"Cross-border wealth management is an important milestone for Greater Bay Area to promote the interconnection of financial markets, providing more wealth management product choices for China mainland and Hongkong residents. With the gradual introduction of relevant policies in Greater Bay Area and the further opening of regional financial markets, it will effectively attract foreign investment and enhance regional competitiveness. It is predicted that Greater Bay Area will become one of the main driving forces for China's economic growth in the future.
Greg Hingston, head of wealth management and personal banking for Asia Pacific at HSBC, said:
"The implementation of the cross-border financial management mechanism is undoubtedly good news for Guangdong-Hong Kong-Macao Greater Bay Area investors who intend to expand their investment scope and further diversify their investments. Cross-border wealth management will further consolidate Hong Kong's position as the largest international asset management center in Asia. The successful launch of "Shanghai-Shenzhen-Hong Kong Stock Connect" and "Bond Connect" proves that the interconnection mechanism is helpful to improve the overall liquidity of the financial markets in the two places. HSBC has been actively participating in various measures to promote market opening. We are confident that' cross-border wealth management' will become a milestone in the opening of China's financial market and bring more development opportunities to the financial services industry. "
"Greater Bay Area is the richest urban agglomeration in China and is expected to become one of the largest financial markets in the world. It is estimated that by 2025, the banking revenue will reach1.85 billion USD, with a compound annual growth rate (CAGR) of 1.3%. As a leading international bank in Greater Bay Area and one of the largest banks in Hong Kong, HSBC will actively assist Greater Bay Area customers to fully grasp this historic opportunity through diversified wealth management solutions, leading digital services and excellent service team. We are going all out to meet the upcoming opportunities with the strongest service capabilities. "