Cross-border investors responded favorably to the Cross-boundary Wealth Management Connect Pilot Scheme in the first two weeks of operation, prompting experts to forecast long-term growth in transaction volume.
The scheme saw 7,600 individuals investing 131 million yuan ($20.5 million) since its official opening on Oct 19, the People’s Bank of China Guangzhou Branch said on Thursday.
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Investors from the Hong Kong and Macao special administrative regions were more enthusiastic in the Chinese mainland’s capital market, with 5,022 people participating in the Northbound Scheme, involving 1,270 transactions totaling 65.5 million yuan. The Southbound Scheme attracted 2,578 mainland investors, with 482 transactions amounting to 65.7 million yuan.
Some industry analysts attributed the slightly higher value of transactions in the Northbound Scheme to the difference in interest rates between the Chinese mainland and the two special administrative regions, a Cailian Press report said
The scheme allows Hong Kong and Macao residents to invest in China onshore investment products through banks in the Guangdong- Hong Kong- Macao Greater Bay Area, while residents of nine cities in Guangdong province can invest in Hong Kong and Macao wealth products through local lending institutions.
Stephen Chan, general manager for personal banking and wealth management department of Bank of China Hong Kong, described the response to both schemes as quite positive with the opening of thousands of accounts.
Some industry analysts attributed the slightly higher value of transactions in the Northbound Scheme to the difference in interest rates between the Chinese mainland and the two special administrative regions, a Cailian Press report said.
Hong Kong's financial products, especially low-risk products, have very low yields, making even the mainland’s low-yield government bonds attractive to many international investors, analysts said.
The number of transactions between Hong Kong and the mainland was 805, with cross-border remittances of 78.65 million yuan, accounting for 59.9 percent of the total remittance amount.
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The transaction volume between Macao and the nine cities in Guangdong was more than 900, with cross-border remittances totaling 52.63 million yuan, or 40.1 percent of total remittances.
“The demand for cross-boundary banking services is expected to be long term and sustainable, bringing new growth momentum to the investment and wealth management business,” Chan said.
The number of accounts opened through BOC Hong Kong comprises 60 percent of the total market, and the reservations for account openings are ongoing, Chan added.