That’s the view from Harvest Global Investments, part of one of the largest institutional asset managers in China, which has recently expanded its London operation to help boost two-way investment flows with the world’s second-biggest economy.
Harvest Global Investments, one of few Chinese asset managers to hold a licence from the UK regulator, said it plans to act as an adviser to Chinese financial institutions looking to invest overseas.
Ashley Dale, HGI’s new chief business development officer, said the company may set up its own investment platform to link Chinese investors with European vendors.
“It could be direct investment; the wall of Chinese money is coming,” Dale told international Adviser in a recent interview.
“The Chinese government has given domestic insurance companies a target to invest 15% of their assets overseas."
Harvest is the largest institutional asset manager in China with over $100bn (£77bn, €89bn) in assets under management and 200 investment professionals across the mainland.
This expertise the company plans to use in marketing its own investment vehicles to savers in the UK and Europe looking to invest in China and across Asia.But it’s in directing the flow of money coming from China that Dale sees as a big new opportunity.
“We have great client relations with Chinese institutions, we are a good trusted partner and we have Hong Kong, UK and New York offices.”
“The idea is that we can act as an adviser and or set up our own investment platform here in Europe. We will act as an adviser to Chinese financial institutions looking to invest overseas.”
Demand for global equity
Dale said that to date much of China’s overseas investment has been directed at the commodities and energy sector and things that will help China, but he said there was certainly demand for global equity to diversify their portfolios.
“The Chinese government has given domestic insurance companies a target to invest 15% of their assets overseas,” he said. “On average there is low single digit of percent invested, so there is billions of dollars available for overseas investments,” Dale said.
“The government has restrictions on money flows but there is a huge amount of Chinese bond insurance overseas which has enabled these companies to establish a war chest of money.”Harvest is not the only asset manager to see the opportunity.
European expansion
Late last year GF Fund Management (GFFM) became the first Chinese investment manager to expand into Europe, opening a London with the aim to provide investment products based around Chinese assets and advise global institutions on accessing quotas to trade directly in Chinese markets.
It’s announcement followed the visit of Chinese premier Xi Jinping to Britain to deepen economic ties between the two countries as China looked to further liberalise its financial markets.
Earlier last year Nord Engine Asset Management, a subsidiary of Chinese private equity firm Nord Engine Group, which has around $3bn of assets under management, opened its first UK office.
