Recently, with approval of China Banking Regulatory Commission (CBRC), Industrial Bank required the qualification of conducting overseas wealth management business on behalf of its clients. A new competent member that offers RMB overseas investment product service was added to the domestic financial institution rank.
Overseas wealth management business on behalf of clients allows domestic institutions and citizens to commit their overseas financial product investment to domestic commercial banks. By utilizing financial products in international market, the business works as a kind of wealth management tool which supplies different profit structure and risk level for investors with diverse profit demand and risk preference. The investment fund is mainly put into overseas product markets with fixed return, including bond, bill and structural product markets, Compared with traditional RMB wealth management business, overseas wealth management business on behalf of clients is featured by two strong points. First one is that the investors can directly purchase foreign currency with RMB and commit their overseas investment to the bank. Upon maturity of investment, the principal and profit returned will be exchanged into RMB and retroceded to investors. Second one is that the bank will submit the investment fund to third party for custody while investing abroad. There are also overseas custody agents available abroad. This helps reduce the investment risk.
Outstanding managerial ability and control ability on investment risk and exchange risk was the crux that enabled Industrial Bank to acquire the qualification of conducting overseas wealth management business on behalf of clients. In the field of foreign currency wealth management, Industrial Bank insists on satisfying the diversified and individualized demand of investors, and advances the customer service level, richens the wealth management product spectrum through improved inner control system. Since 2003, Industrial Bank has launched 22 batches of "WHT" foreign currency wealth management products, 18 batches of "WLB" RMB wealth management products, and diversified products hooking to interest, exchange rate, gold, petroleum, fund index and stock, accumulating a sales amount up to RMB 20 billion.
Before acquiring the qualification of conducting overseas wealth management business on behalf of clients, RMB structural deposit, a product operated under foreign currency mode, had been already carried out by Industrial Bank. The product was a RMB wealth management product that enabled mixed investment both inside and outsider nation border. The nature of the product was to invest RMB principal mainly in domestic inter-bank market, and to operate in overseas market with the profit returned from the principal through option and swap. The profit returned usually depended on the performance of exchange rate, interest rate and index. The successful operation of RMB structural wealth management products by Industrial bank had laid solid foundation for business of conducting overseas wealth management business on behalf of clients.
It was reported that recent years had seen great momentum boost of Industrial Bank. According to latest "Top 1000 World Banks" released in July 2006 by the Banker, a British based magazine, Industrial Bank ranked 164th with 46 positions advanced in terms of total assets. It was the first time for the Industrial Bank to rank among top 200 world banks. According to the latest "Top 300 Asian Banks 2006" released by Asia Week in Hong Kong, Industrial Bank has become to be the domestic bank that experienced fastest ranking boost in terms of total assets.