A joint venture between Vanguard and Ant Financial has been registered with an initial investment of CNY20m (£2.3m, $2.9m, €2.6m), according to the mainland China website Tianyancha, which contains public records and is approved by China’s central bank.
It will offer is investment consulting services.
Huang Hao, president of Alibaba affiliate Zhejiang MY Bank, is the venture’s legal representative.
Ant Financial will take a 51% stake in the company, while a Vanguard subsidiary will hold the rest of the new enterprise.
It will be located in the Shanghai free trade zone.
Two titans
Ant Financial, a fintech company, was founded in 2014. It operates Yu’ebao, a money market fund with CNY1.13trn in assets.
Vanguard, with $5.2trn in global assets, is one of the world’s top providers of passive investment products, although one-third of those assets is from actively-managed products.
However, it has been very low key in Asia, particularly compared to rival firm i-Shares. For example, Vanguard has six ETFs registered for retail sale in Hong Kong compared to i-Shares 12 products, according to FE data.
In May 2017, Vanguard opened a wholly foreign-owned enterprise (WFOE) structure in China. It has 20 staff members, but none are involved in investment management. Additionally, the firm has not applied for a private fund management licence, which would enable the launch of an onshore fund.
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