China Merchants Bank (CMB) has received approval from the securities regulator to become the largest shareholder in China Merchants Fund Management as it moves to diversify into non-banking services. It is the first time the China Securities Regulatory Commission has allowed a bank to buy into an existing fund management company, the South China Morning Post reported. Shenzhen-based CMB will buy a 33.4% stake in the fund house currently shared by China Power Finance, China Huaneng Finance, Cosco Finance and China Merchants Securities. Approval is still required from state assets regulator. CMB, the country's seventh largest lender, is among the second batch of banks to run fund houses. Industrial and Commercial Bank of China, Bank of Communications and China Construction Bank have already set up fund management joint ventures with foreign partners.