The British fund manager first received regulatory permission to form the business in February 2021. Credit: Can Pac Swire/Flickr.

Schroders has received regulatory approval for the business commencement of its wealth management joint venture (JV) with Bank of Communications Wealth Management (BCOWM).

The approval was granted by the China Banking and Insurance Regulatory Commission (CBIRC).

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The British fund manager first received regulatory permission to form the business in February 2021.

The latest approval will allow Schroder BOCOM Wealth Management, which has registered capital of $158m (CNY1bn), to start operating immediately. It is said to be the third international joint venture wealth management company to be licenced in China.

Schroders Investment Management owns 51% of the JV while the remaining 49% stake is held by BCOWM.

BCOWM is an existing partner for Schroders’s Chinese fund management JV, which it set up in 2005.

Having established its Chinese footprint in 1994, the fund manager has been accelerating its China push to grab a bigger piece of the country’s evolving economy.

Schroders said that its new JV with BCOWM will provide significant opportunity to tap into China’s sizeable equity and bond markets.

Schroders Global head of Distribution Lieven Debruyne said: “The announcement of this licence is an important development in the long and successful relationship we have built with BOCOM. Since 2005, we have supported our partner on asset management needs.

“This is a new chapter. It offers the opportunity to grow a wealth management proposition together, to further extend our first-class investment capabilities and innovative product range to a greater number of savers in China.”

Amundi BOC Wealth Management Company is the first foreign majority-owned company to be cleared by CBIRC to provide wealth management products to mainland investors.

It secured its licence from the regulators in September and started operations in October.

In 2020, the CBIRC granted approval for BlackRock to form its wealth management JV with Temasek and China Construction Bank.