Banking News
- Huaxia Bank to open mutual fund unit
Date: 27-Dec-2007 Sources: (Xinhua Online)
BEIJING, Dec. 26 -- Huaxia Bank Co plans to set up a mutual fund management unit to diversify revenue by tapping the growing appetite for investment products.
The Beijing-based bank is hiring staff for the venture, which is still in the preparation stage, Huaxia said in a statement on its Website, without giving more details.
China allowed domestic lenders to expand into mutual fund management in 2005.
Lenders including Bank of Communications, Agricultural Bank of China, China Construction Bank and Industrial & Commercial Bank of China have all set up fund units.
China's decade-old fund management industry is expanding rapidly amid a booming stock market and low interest rates on bank savings, which channel savings from bank accounts to the stock market.
The one-year benchmark deposit rate sits at 4.14 percent after six interest rate increases this year, lagging the 6.9 percent inflation of November.
Meanwhile, the benchmark Shanghai Composite Index has nearly doubled this year, attracting investors to opening stock-trading accounts.
Mutual funds in China expanded to about three trillion yuan (409.8 billion U.S. dollars) at the end of October from December 2006's 900 billion yuan, according to Shanghai Securities News
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