The asset scale of CMS fund custody and outsourcing tops RMB 10 billion.

CMS (2014-07-21 13:58) [Full Text]

China Merchants Securities (CMS) has achieved an asset scale of over RMB 10 billion in its fund custody and outsourcing business by the end of June 2014, occupying the largest market share among its securities broker peers. With the performance, CMS has successfully served as the No. 1 custodian in the industry and is a high-profile brand in the market.

At the beginning of the year, CMS has clearly defined its fund custody and outsourcing business as a strategic priority, including the business into the pilot work scope of integrated operation of CMS branches and listing it as a KPI for the specialized evaluation of sales departments in 2014. In addition, CMS has also formulated policies on the revenue-sharing and incentives for the marketing custody and operation outsourcing in branches and set up a special award for the execution of the custody & outsourcing business strategy. Mr. Wang Yan, president and CEO of CMS, assumed commands and facilitated the cooperation between CMS and Chongyang Investment, the largest private securities fund in China. The two has jointly issued the first private securities fund in a real sense in China, i.e., Chongyang A share alpha hedge fund, and CMS offers an integrated package service of "custody + outsourcing".

It is becoming an industry trend that private securities fund issue products independent of the trust channels. CMS offers private securities fund custodians with the one-stop service of "custody + outsourcing" throughout the product life cycle. This seamless one package service features high efficiency, strong professionalism, wide coverage, flexible modes, and closeness to client needs and helps private equities address the challenges present during the independent issuance of products. The challenges include high operation and labor cost, huge system investments, and weak control over operational risks. Since joining hands with Chongyang Investment, CMS has established cooperation ties with significant private securities fund, including Low-Risk, Broad Capital, Greenwoods Investment, Rosefinch Investment, Chaos Investment, Whiterock Asset, HEAVEN-SENT Capital, Vanfon Funds, U-shine Fund Management, Infore Capital, JP Investment, and Noah Upright etc.

RMB 10 billion is a new start point. This year, CSRC chairman Xiao Gang has repeatedly expressed the priority to develop private securities funds. By the end of June 2014, near 3,500 custodians had completed registration at Asset Management Association of China, with about RMB 2 trillion of private securities products in custody. Based on a custody and outsourcing rate of 2‰, an income of RMB 4 billion will be generated. Huge potential is locked in the private fund custody and outsourcing market. Apart from private funds, CMS custodian services have also vigorously expanded the custody and outsourcing business to more diverse clients, such as public funds, special fund accounts, broker asset management, future asset management, trust products, and insurance capital etc. To take fund companies as an example, CMS has established partnerships with ChinaAMC, Huashang Fund, Bosera Funds, China Merchants Fund, CCB Principal Asset, Fullgoal Fund, Dacheng Fund, and Ping An-UOB Fund etc. 


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