Embracing the new era:A new chapter of opening-up in China’s financial sector

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Mar 2018

2018 marks the beginning of a new era that China further opens up its financial service sector – another good time for foreign financial institutions to seize the country’s growth opportunity.

2017 is a year of significance for China, as the 19th CPC National Congress laid out the country’s development blueprint for the next decades. The 19th Party Congress Report, as well as recent Government Work Report, has committed to further open up China’s financial service industry by both expanding market access and lifting foreign investment restrictions:

  • The current 49% ownership cap on foreign investment in securities, fund management, and futures companies will be raised to 51%; three years following the investment, the cap will be removed, allowing 100% foreign ownership. 
  • The current 20% cap of foreign ownership of domestic banks or financial asset management company (or 25% if there are multiple foreign investors) will be eliminated. 
  • In three years, foreign investors will be allowed to own up to 51% of life insurance companies (currently, the cap is 50%); the cap will be removed five years following the investment, allowing for 100% foreign ownership. 
  • As of 2017, as many as nine wholly foreign-owned asset management institutions in Shanghai Free Trade Zone have obtained The Private Securities Investment Fund Manager (PFM) license and issued a number of products.

These are only a fraction of upcoming policies. By the end of 2017, total assets of China’s financial services industry reached USD 44 Trillion. As China committed to further opening up, we expect foreign financial institutions’ (FIs) market share to continue to expand in the future – 2018 is the another good timing for foreign FIs to seize China’s growth opportunity.

Contact us

James Chang
China Financial Services Consulting Leader
Tel: +[86] (10) 6533 2755
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Harry Qin
Partner
Tel: +[86] (10) 6533 5356
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Jason Li
China Financial Service Consulting Director, PwC China
Tel: +[86] (10) 6533 7436
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