The U.S. lender is reportedly in preliminary talks with China Merchants Bank to set up an entity, expanding on a strategic partnership on products in 2019.
J.P. Morgan is seeking to expand its reach in China with the establishment of a wealth management joint venture on the mainland, «Bloomberg» reported on Tuesday, citing people familiar with the matter.
Details about the agreement with Shenzhen-based China Merchants Bank, which operates the country's largest private bank, have yet to be ironed out, but J.P. Morgan is unlikely to have control, its sources said (behind paywall), noting that the plan is subject to change and talks could still fall apart.
In establishing a wealth venture in China, J.P. Morgan would be competing with a joint venture between Blackrock, Temasek and China Construction Bank, which was approved in August 2020, as well as an Amundi-Bank of China JV.
China Focus
J.P. Morgan is rapidly making multi-pronged inroads into China via the historic opening of the mainland’s financial services sector, which is estimated to be worth $45 trillion.
The American bank currently has a 51-percent interest in an asset management joint venture with Shanghai International Trust, and has been in talks to fully acquire the remaining 49 percent for a figure that is said to be least $1 billion.
J.P. Morgan was approved by regulators to establish a fully-owned futures business in June 2020, and raised its ownership of a majority-owned securities venture from 51 percent to 71 percent in October.
