The asset management sector in China experienced something of a revival in 2021, recording its first >10% growth since 2018, after almost three years of industry shakeups and regulation changes, reports Caixin. The industry expanded 11% in 2021 to a record RMB 134 trillion ($20.5 trillion) at the end of 2021, according to a report issued jointly Friday by Boston Consulting Group and Everbright Bank. It was the first time the industry’s growth reached double-digits since a set of overarching rules were issued in 2018 to tame the once unregulated market.
The new rules issued by the central bank sought to overhaul the entire asset management industry, including business by banks, brokerages, trust firms and other financial institutions.
The framework was designed to dismantle risks in the sprawling asset management industry. The then-$16 trillion sector was plagued by lax supervision, excessive leverage and risks from mismatches between the duration of products and the maturity of assets. The industry created a complex financing web outside the formal banking system, including trillions of yuan of investment products managed by banks and securities brokerages.