Shangyin Fund introduces foreign investors as shareholders! Additionally, 46 public funds have foreign investment behind them, and these three trillion-level public funds are actually also...

Ask AI · After Yin Yin Fund introduced foreign capital, how can it enhance competitiveness in equity-based products?

YiQu Jun

“A total of about 47 public funds are foreign wholly owned or foreign-held, accounting for nearly one-third of the market share in the public-fund industry.”

Recently, a regulatory reply from the CSRC has pushed Yin Yin Fund into a new stage of Sino-foreign joint venture. Santander Investment officially took over 20% equity. This bank-backed public fund, with an asset management size of over RMB 250 billion, has thus become the newest member in the lineup of public funds with foreign equity holdings. According to institutional research and statistics, as of March 2026, there are a total of about 47 public fund companies that are foreign wholly owned or have foreign shareholding, together accounting for nearly one-third of the market share in the public-fund industry.

When the path for foreign capital to enter China’s public-fund market expands from “establishing new entities” to “taking minority stakes,” a multi-layered, multi-form pattern of foreign shareholding has already taken shape.

An equity transaction spanning three years

In March 2026, the CSRC approved that Santander Investment Holding Co., Ltd. became a shareholder holding more than 5% of Yin Yin Fund, and that it would take over Yin Yin Fund’s RMB 60 million equity contribution (representing 20% of the registered capital) pursuant to the law was met with no objection. After the transaction was completed, the Bank of Shanghai’s shareholding fell to 80%, Santander Investment’s shareholding became 20%, and Yin Yin Fund thereby became yet another joint venture bank-backed fund company.

The push for this transaction took more than 3 years. As early as November 2022, Bank of Shanghai had exercised its right of first refusal to transfer 10% equity in Yin Yin Fund from the original shareholder, China National Machinery Industry Group Co., Ltd. In March 2023, Bank of Shanghai listed 20% equity for transfer on the open market; after that, it went through multiple steps including soliciting potential transferees and regulatory approvals, and ultimately wrapped up in March 2026.

The background of the foreign shareholder is deep. Santander Investment is an important member of the Santander Bank Group of Spain. Santander Bank was founded in 1857 and is one of the globally systemically important banks. As of end-2025, its total assets reached EUR 1.4 trillion, serving 180 million customers and operating 7,100 branches.

Notably, Santander Bank itself is the third-largest shareholder of Yin Yin Fund’s major shareholder, Bank of Shanghai, with a stake of 6.54%. Since 2014, both sides have signed multiple rounds of strategic cooperation agreements. The most recent round was signed in April 2025, covering areas such as corporate finance, retail banking, cross-border payments, and green finance. This “dual attachment” provides a natural foundation of trust for introducing foreign equity shareholders to Yin Yin Fund.

Yin Yin Fund was established in August 2013 and has developed to date relying on the background of Bank of Shanghai. Latest data shows that its public fund asset management size is about RMB 252.3 billion, with fixed-income products playing an absolute leading role and equity-based products having a relatively low share. After introducing foreign equity shareholders, whether this bank-backed public fund can maintain its fixed-income advantages while also making up for its equity shortcomings will become a key focus for the market.

A three-tier structure of public funds with foreign shareholding

With Yin Yin Fund completing the equity change, China’s domestic public fund companies with foreign shareholding have formed a complete matrix with three tiers and diverse forms.

Among them, there are 9 foreign wholly owned public fund companies, including newly established institutions such as BlackRock Fund, Fidelity Fund, and Lumps? (note: the original text says 路博迈基金) and also foreign-controlled entities that transitioned to foreign wholly owned, such as Morgan Asset Management, Morgan Stanley Fund, and Manulife Fund—whose governance systems are complete but local accumulation is still limited.

About 34 public fund companies have foreign shareholding of more than 20%, including leading firms such as Huaxia Fund, Full? (the original says 富国基金,嘉实基金—leave names as proper) and DBS? (none) and also long-established joint ventures such as J.P. Morgan Asset Management (note: original is 交银施罗德,景顺长城,华泰柏瑞), Invesco Great? (again no), and HuaTai? The original: 交银施罗德、景顺长城、华泰柏瑞 etc. Keep as is: Jia? etc. Their foreign shareholding is typically between 20%-49%, with Chinese shareholders still maintaining controlling positions, and foreign shareholders have stronger say in governance and investment research.

About 4 public fund companies have foreign shareholding below 20%, including Ping An Fund, China Life-C? (国寿安保基金), Bank of China B? (中银基金), and Xingzheng Global Fund. Their foreign shareholding ratios are low, mainly representing financial investment; the extent of foreign participation in governance and investment research is limited.

Foreign wholly owned public funds: early movers starting from zero

Since April 2020, when the CSRC removed the foreign investor shareholding ratio restriction for public funds, global giants have accelerated their China expansion. To date, there are 9 foreign wholly owned public fund companies in Mainland China, of which 6 are newly established institutions and 3 were converted from Sino-foreign joint ventures to foreign wholly owned entities.

Newly established institutions include BlackRock Fund (approved in 2020, the first foreign wholly owned public fund), Lombard? (路博迈基金), Fidelity Fund, Schroder Fund, AllianceBernstein Fund, and Allianz Fund. Except for Allianz Fund, the other five have already commenced operations and launched their own public fund products. These institutions build teams from scratch, fully replicating the foreign investment research and compliance framework, but they still need to start from zero in terms of brand recognition and channel accumulation.

Converted institutions include Manulife Fund (formerly TEDA? Manulife), Morgan Asset Management (China) (formerly JPMorgan?), Morgan Stanley Fund (formerly Morgan Stanley Huax?; keep original names), achieving 100% foreign control through equity changes.

From a product layout perspective, foreign wholly owned public funds show a steady strategy of “fixed income first, then equity.” This year to date, BlackRock Fund, Lombard? (路博迈), Schroder Fund, and others combined have submitted 6 funds, all of which are bond funds. AllianceBernstein Fund issued its first actively managed equity-tilted hybrid product, AllianceBernstein Smart Selection, in March.

From performance, products such as BlackRock Advanced Manufacturing, Fidelity Inheritance, Fidelity Low Carbon Growth, Allianz China Select, and Schroder China Momentum all saw net value increases exceeding 50% since 2025. In terms of holdings, these funds generally focus on China’s technology sectors; stocks such as SMIC? (original: 中际旭创), Cambricon? (寒武纪), Tencent Holdings, and Xin Yisheng (新易盛) appear among the top ten heavily held stocks in multiple funds.

Foreign wholly owned public funds generally view China’s investment opportunities favorably. Lombard? (路博迈基金) believes that China’s economic structure transition is underway, and the replacement of old and new growth drivers will catalyze new investment opportunities. Schroder Fund points out that the rise of “better-for-less” consumption is a major highlight in this year’s consumer market, and relevant companies have achieved impressive growth. Looking ahead, these early movers starting from zero are gradually moving from “initial mismatch” toward “deep localization,” becoming an indispensable new force in China’s public fund market.

Foreign equity shareholding above 20%: the main force in the backbone camp

This is the largest group in both number and scale among public funds with foreign shareholding, covering Huaxia Fund, Full? (富国基金), and Harvest? (嘉实基金) among other leading companies, as well as Invesco Great Wall Fund and Huatai-Perry? (华泰柏瑞基金) and other long-established joint ventures, for a total of about 34 companies. Their foreign shareholding ratios range from 20% to 49%. Foreign shareholders have stronger voice in governance and investment research, forming the backbone of China’s public fund industry.

This tier can further be divided into three categories: old-established joint ventures formed early, bank-backed joint ventures, and “latecomer strategic enlistment” institutions that introduced foreign capital through equity transfers in recent years.

Old-established joint ventures are the core force in this tier. Leading companies such as Huaxia Fund, Full? (富国), Harvest? (嘉实), and Penghua Fund introduced foreign equity shareholders early in the industry’s development stage, forming a mature model of “foreign investment research + local channel.” These institutions are large in scale with complete product lines, accumulating deeply across various areas including equity, fixed income, and indices.

Among them, Huaxia Fund’s foreign combined shareholding is 37.8% (Mik? (迈凯希) 27.8% + Qatar 10%). In 2025, Qatar’s sovereign fund made an investment, injecting Middle East capital into this leading firm;

Full? (富国基金) is held by Haitong Securities and Shenwan Hongyuan Securities, and Montreal Bank of Canada, each holding 27.775%. It is the first batch of fund companies to achieve foreign participation as minority shareholders. In recent years, its index fund scale surged from RMB 64.4 billion to RMB 325.5 billion, becoming the core engine for scale growth;

Harvest? (嘉实基金) foreign shareholder Deutsche Asset Management holds 30%, showing clear advantages in areas such as enhanced index and pension business;

Penghua Fund’s foreign shareholder is Italy Ol? (欧利盛资本) with long-term holdings, developing in a balanced way across both fixed income and equity. Currently, Penghua Fund’s equity structure is: Guosen Securities holds 50%, Italy Ol? (欧利盛资本) holds 49%, and Shenzhen Beirongxin Investment holds 1%.

Invesco Great Wall Fund, Huatai-Perry? (华泰柏瑞基金), China International? (国投瑞银基金), and Haitong? (海富通基金) are also representative examples of old-established joint ventures.

Among them, Invesco Great Wall Fund’s foreign shareholder Great Wall Group holds 49%, which is a benchmark for “foreign investment research + local channels,” and in the past decade, its absolute returns in equity funds have ranked among the top;

Huatai-Perry? (华泰柏瑞基金)’s foreign shareholder, Perry Investment, holds 49%, and its CSI 300 ETF is an industry benchmark product;

China Southern? (国投瑞银基金)’s foreign shareholder, UBS? (瑞银集团) holds 49%, relying on UBS’s global investment research resources; Haitong? (海富通基金)’s foreign shareholder is BNP Paribas? (original: 法国巴黎银行) holding 49%, which has been deeply involved in the pension business for many years and holds the qualification as an overseas investment manager for social security funds.

Bank-backed joint venture institutions are another important component of this tier. Among them, those with foreign shareholding of 49% includeHuabao Fund,Guohai Franklin Fund, and****HSBC Jinxin Fund.

Everbright Suning? (光大保德信基金) has foreign shareholding of 45%; Rongtong Fund has foreign shareholding of 40%. Pingyin? (浦银安盛基金) has foreign shareholding of 39%; Xinda-Aoy? (信达澳亚基金) has foreign shareholding of 38%; Founder-Fubon Fund and East? (东方汇理基金) have foreign shareholding of 33.3%; Swen? (申万菱信基金), Great? (长盛基金), and Eagle? (金鹰基金) have foreign shareholding of 33%; Jia? (交银施罗德基金) and Minsheng? (民生加银基金) have foreign shareholding of 30%.

In addition, China-Canada Fund has foreign shareholding of 28%; Yongying Fund, China Merchants? (中海基金), and H? (华宸未来基金) have foreign shareholding of 25%; SuXin Fund has foreign shareholding of 24%; Yin Yin Fund has foreign shareholding of 20%, etc., together forming a rich map of this tier.

They either focus on equities, or excel in fixed income, or form distinctiveness in niche areas—jointly supporting a diverse ecosystem in China’s public fund market.

In recent years, bank-backed funds are gradually expanding their equity boundaries through “fixed income+” and index products. For example, Yongying Fund implemented an employee shareholding plan in 2025, becoming the first city commercial bank-backed public fund to implement binding of core team interests. Over the past two years, the scale of equity products grew by more than RMB 100 billion. With Yin Yin Fund’s latest introduction of Santander Investment, this is a new trend for introducing foreign investors into bank-backed public funds. Meanwhile, China-Europe Fund, in which Ping? (华平亚太资产管理) holds 23.3%, breaks the traditional classification of this tier: it excels in active equity investing and has well-known fund managers such as Zhou Weiw? (周蔚文) and Cao Mingchang (曹名长).

Foreign shareholding below 20%: a strategic supplement from financial investment

For these institutions, the foreign shareholding ratio is low, between 10%-20%, mainly representing financial investment, and the extent of foreign participation in governance and investment research is limited. While they are not foreign-controlled institutions, the addition of foreign equity shareholders still brings an international perspective and resources to the company, representing another form of foreign participation in China’s public fund market. Currently, about 4 institutions fall into this category.

Two insurance-backed fund companies as representatives. Ping An Fund’s foreign equity shareholder is Dahua Asset Management, an asset management company under Singapore’s Oversea-Chinese Banking Corporation (OCBC). It holds 17.51%. The company emphasizes layouts across both fixed income and equity. China Life Pension? (国寿安保基金)’s foreign equity shareholder is Anbao Capital Investment, holding 14.97%; the company has advantages in fixed income and pension business.

Bank of China Fund’s foreign equity shareholder is BlackRock, holding 16.5%. BlackRock is the world’s largest asset management firm. Although its shareholding ratio is less than 20%, its participation still injects an international asset management perspective into the company, especially in index products and ESG investing, drawing on global experience.

Xingzheng Global Fund’s foreign equity shareholder is Singapore Government Investment, holding 10%. As a sovereign wealth fund, Singapore Government Investment provides a stable international perspective through long-term holdings. The company focuses on equity investing and has maintained steady long-term performance, winning recognition from institutional investors.

A comparison and outlook of the three types of institutions

In terms of entry path, foreign wholly owned entities mainly come via “new establishment” and “acquisitions.” Starting from zero or achieving 100% control through equity changes are strategic footholds for deep foreign investment. Public funds with foreign shareholding above 20% are mostly “inherently joint ventures” or “latecomer strategic enlistment,” introducing foreign capital while maintaining Chinese control. This includes both older institutions established early in the industry and, in recent years, bank-backed public funds that introduced foreign capital through equity transfers. Public funds with foreign shareholding below 20% are mainly financial investment, with lower foreign shareholding ratios, more reflecting supplementation of strategic resources.

In terms of scale distribution, institutions with foreign shareholding above 20% form the scale base. For example, Huaxia Fund has a scale of over RMB 210 billion; leading companies such as Full? (富国), Harvest? (嘉实), and Penghua have scales over RMB 100 billion; Yongying Fund has a scale of RMB 62.75 billion; and Jia? (交银施罗德), Invesco Great Wall, and others also often sit in the several-hundred-billion category—constituting the backbone of the public fund industry. Institutions with foreign shareholding below 20% vary in scale; Ping An, China Life Pension, and others are in the several-hundred-billion range; Bank of China and Xingzheng Global are also above RMB 10 billion (hundred?); Foreign wholly owned public funds started later and generally have smaller scales, with Morgan Asset Management (China) at about RMB 20.65 billion, and most others below RMB 10 billion; Lombard? (路博迈) and BlackRock are in the tens of billions range.

From a business focus standpoint, foreign wholly owned public funds generally adopt a prudent strategy of “fixed income first, then equity.” Early products are mainly bond funds; after teams have matured through coordination, they gradually expand into equity products, with holdings typically focusing on China’s technology sectors. Among institutions with foreign shareholding above 20%, old-established joint ventures have deep accumulation across equity, fixed income, and indices; bank-backed joint ventures highlight advantages in fixed income by leveraging their parent bank’s channels, and in recent years are expanding equity boundaries step by step through “fixed income+” and index products. Institutions with foreign shareholding below 20% each have their own strengths; some excel in equity investment, others have clear advantages in pension business. Foreign participation is often an added bonus.

Foreign public funds are extending from fixed-income products into equity products. For example, AllianceBernstein Fund has already issued equity-tilted hybrid products. Institutions with foreign shareholding above 20% continue to deepen their advantaged tracks: leading companies such as Huaxia and Full? are actively expanding in areas like indices and ETFs, while bank-backed joint venture public funds are gradually extending equity boundaries through “fixed income+” and index products.

Foreign public funds form differentiated competition through distinctive product lines. For example, institutions such as BlackRock, Morgan Asset Management, and Fidelity have already issued green bond index funds or ESG themed equity funds, combining global sustainable investment experience with China’s “dual carbon” goals to build distinctive product lines and create differentiated competitive strength.

Foreign public funds target the “second growth curve.” For bank-backed joint venture public funds that are strong in fixed income—such as Yin Yin Fund, Jia? (交银施罗德), and Agricultural Bank? (农银汇理)—after introducing foreign equity shareholders, how to maintain a steady base while also filling equity shortcomings will be the key to determining their “second growth curve.”

**However, **foreign public funds also face common challenges. For example, how to convert external resources into internal capabilities; how to fill equity shortcomings on the basis of fixed income advantages; and how to establish truly independent, market-oriented mechanisms—these are all questions that foreign public funds need to answer together.

Looking at the overall landscape of public funds with foreign shareholding, the equity change of bank-backed joint ventures like Yin Yin Fund is both a case study and a trend—the path for foreign capital to enter China’s public fund market is continuing to broaden. As for genuine value creation, it still needs to be validated by time.

Source: Institutional research