Qianhai funds win approval to raise RMB in Hong Kong - report
Chinese regulators have reportedly given the green light for private equity firms operating in Shenzhen's Qianhai region to raise renminbi offshore to invest in mainland.
The National Development and Reform Commission has granted official approval to the proposal that funds registered in the region can tap Hong Kong for renminbi capital, the China Securities Journal reported on Monday, citing an unnamed senior official in the administration of Shenzhen Qianhai authority. The officials will make an announcement soon, it said.
Given the high threshold on the capital scale of the fund, so far, only China Development Bank has submitted a plan to raised 50 billion yuan ($8.04 billion), the report added.
As part of broader efforts to internationalize the renminbi, Qianhai was designated a testing ground for eased currency movements in June 2012. In addition to private equity funds raising renminbi in Hong Kong, initiatives include enabling companies registered in Qianhai area to source renminbi-denominated loans from Hong Kong banks.
A group of private equity players including The Blankstone Group and KKR have reportedly held preliminary talks with government authorities about setting up funds in Qianhai. In July, John Zhao, CEO of Hony Capital, said that his firm might raise its next renminbi fund via the program.
Yawei Wang, a former leading fund manager at China Asset Management (CAMC), who also earned a reputation as one of China's best stock pickers, registered a private equity firm in Qianhai five months ago.
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