Despite going through major reform, bank wealth management assets in China continue to grow. As of June 2022, bank wealth management product (BWMP) assets amounted to $4.4 trillion and the number of investors nearly doubled from 41.6 million in 2020 to 81.3 million in 2021, reaching 91.5 million in the first half of 2022. Broad distribution networks, a need for yield that’s higher than deposits, ease of access, and the popularity of bank WMPs have enabled resilient demand, enabling this segment to compete well with mutual funds.

Cooperation between leading domestic bank wealth management subsidiaries (BWMSs) and giant foreign asset managers provides opportunity for foreign institutions to expand in the Chinese market and enhance their brand awareness. In addition to cooperation, the research finds that BWMSs’ outsourcing activities to fund management companies (FMCs) are expected to grow over the next few years, even as they try to build in-house research and investment capabilities.

As local and foreign players break into the market, we see competition tightening, not just in distribution, but also in internal investment capabilities. Maintaining a strong brand name and a good track record, as well as working with more product, distribution, and asset management partners, will be key to accelerating growth in this market. To learn more about what your firm should consider when evaluating this market, explore these findings and more in our latest report.