Lufax, China private funds to launch online products
Shanghai Lujiazui International Financial Asset Exchange (Lufax), a Chinese online financial platform controlled by Ping An Insurance Group, has signed agreements with 30 domestic private investment fund managers that will see their products distributed online.
The managers include Shanghai Chongyang Investment, DH Fund Management, China Future Capital, Greenwood Asset Management and Starock Investment, among others. They will offer high quality financial products on Lufax's platform and partner with Lufax to launch new products.
Xiaojun Yang, formerly deputy director of the innovation department at the China Banking Regulatory Commission and present vice president of Lufax, told local media that private funds are one of the core services offered by the platform.
Lufax was set up in September 2011 with RMB837 million ($130 million) in capital and the support of the Shanghai government and Ping An. The management team of Lufax is headed by Gregory Gibb, who was previously a senior partner with McKinsey & Company responsible for Greater China financial services coverage.
The company started out as an online peer-to-peer (P2P) lending platform and it has expanded into mutual fund, cross-border trading and insurance sectors. Earlier this year, the online financial platform raised a RMB3 billion round of funding led by BlackPine, with participation from the private equity division of China International Capital Corporation (CICC) as well as CDH Investments.
Last year, the China Securities Regulatory Commission issued fundraising rules governing the domestic private fund industry, which include private-offered securities funds or "sunshine funds," private equity funds, venture capital funds, and specialist funds such as wine and art funds.
The rules give a definition of investors qualified to participate in these funds. Investors - including institutional and individual investors committing more than RMB1 million to a privately-offered fund - must meet at least one of three criteria: have at least RMB10 million in net assets; have individual financial household assets of at least RMB3 million; or have an average annual individual income of at least RMB500,000 in the last three years.
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