CHINA'S FUND MANAGEMENT industry has grown rapidly over the past six years to amass $20 billion in assets under management. And foreign fund managers are enthralled by the domestic market's vast potential.
But Sino-foreign joint venture fund management firms are having a tough time of it. Last year, several funds for domestic investors were launched but quickly lost up to half of their assets under management because of speedy redemptions.
ABN Amro Asset Management was the first foreign firm to enter China's domestic fund management industry when it bought into an existing local fund manager, Xiangcai Hefeng. In April 2003 the firm completed the public offering for its first mutual fund in China, raising Rmb2.63 billion ($318 million).
But by the end of December the umbrella fund had lost nearly 50% of its assets to reach Rmb1.43 billion. Its growth sub fund suffered the largest percentage drop...
