05 March 2017

HSBC to provide custody services for first Malaysia-based RQFII


Kuala Lumpur: CIMB-Principal Asset Management Berhad (“CIMB-Principal”) has become the first asset management company in Malaysia to obtain the Renminbi Qualified Foreign Institutional Investor (RQFII) licence. The licence was recently awarded to CIMB-Principal by the China Securities Regulatory Commission (“CSRC”).


Munirah Khairuddin, Chief Executive Officer of CIMB-Principal said, “With the RQFII licence, we will have direct access into China’s capital markets and invest in the hitherto inaccessible products such as the A-shares and bonds of China entities. We plan to develop and introduce more innovative products that invest in China onshore securities, as well as diversify some existing investment portfolios directly into China’s onshore equities and fixed income securities. This, I believe, will definitely add value to our customer proposition for both Malaysian and international clients.”


CIMB-Principal has appointed HSBC (Malaysia) Trustee Berhad as Trustee, The Hongkong and Shanghai Banking Corporation Limited as Global Custodian and HSBC Bank (China) Company Limited (“HSBC”) as its China RQFII custodian. As the onshore custodian bank in China, HSBC facilitated CIMB-Principal’s application for the first Malaysia RQFII licence, demonstrating its continued leadership in helping global investors access the Chinese securities markets.


Commenting on the announcement, Mukhtar Hussain, Chief Executive Officer of HSBC Malaysia said, “We are proud to be appointed the custodian bank for Malaysia’s first RQFII. The size of the RQFII quota granted to Malaysia is further evidence of China’s commitment to granting investors greater access to its markets. We are confident this will be the first of many investments flowing through the China-Malaysia business corridor, which is growing in importance every year. HSBC has a number of firsts in servicing institutional investors in China. We are delighted to add another notch to our already stellar track record.”


In November 2015, China extended the RQFII programme to Malaysia with an initial RQFII quota of RMB50 billion. This makes Malaysia the 14th overseas jurisdiction to be included in the RQFII programme, which has already embraced markets such as Korea, Singapore and the United Kingdom. 


To-date, CIMB-Principal has a total of 63 unit trust funds (of which 19 are Shariah-compliant), 19 wholesale funds, 10 Private Retirement Scheme (PRS) funds and two exchange-traded funds (ETFs). The Company recently won fund performance awards at The Edge Thomson Reuters Malaysia Fund Awards 2017 for Best Equity Global for the 3 years and 5 years categories, Best Equity Asia Pacific Ex-Japan and Best Equity Asia Pacific Ex-Japan (Islamic) for the 5 years categories. The company was also named Best Fund House in Malaysia by AsianInvestor for its Asset Management Awards 2016, Best Asset & Fund Manager, Malaysia (2007-2016) by Alpha Southeast Asia for its 10th Annual Best Financial Institution Awards 2016 and Asset Management Company of the Year, Malaysia by The Asset Triple A for its Asset Servicing, Fund Management and Investors Awards 2016. As at 31 December 2016, CIMB-Principal Group had a total of RM67.6 billion in assets under management.


According to data from State Administration of Foreign Exchange, as of February 2017, HSBC was the custodian bank with leading market share of registered/approved investment quota for RQFIIs.  HSBC has also recorded a number of "firsts" in servicing institutional investors, including being the first custodian bank servicing RQFIIs in Australia, Canada, France, Germany, Korea, Luxembourg, Switzerland, Thailand, USA and the United Kingdom; and the first foreign custodian bank servicing RQFIIs in Singapore and Hong Kong.


HSBC offers foreign institutional investors a wide range of services in China, including QFII/RQFII/B share/CIBM (Inter-bank Bond Market) custody services, relevant clearing and settlement of securities trading, interbank bond settlement and clearing, agency services and futures margin depository services for QFII/RQFII under custody.