Last updated: 08:12 / Friday, 23 December 2016
Investments in China

Ireland Domiciled Funds Get RQFII Boost

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Ireland Domiciled Funds Get RQFII Boost
  • The quota means Irish funds can buy securities on local Chinese markets
  • Taken together, these developments affecting both active and passive funds are expected to increase the number of Chinese and international fund managers establishing funds in Ireland, according to Irish Funds

An agreement between the People’s Bank of China and Ireland means that funds domiciled in the country now can tap into a RMB 50bn (roughly €7bn) quota under the Renminbi Qualified Foreign Institutional Investor regime.

The quota means Irish funds can buy securities on local Chinese markets.

The news follows confirmation that the Central Bank of Ireland is able to accept applications from Ireland domiciled Ucits and AIFs to invest through the Shenzen-Hong Kong Stock Connect, notes Irish Funds, the body representing the cross border investment funds industry in Ireland. This adds to the existing agreement on the Shanghai-Hong Kong Stock Connect.

Looking ahead, Irish Funds adds that there are expectations of another boost for the Irish funds industry as and when indices start to include Chinese shares, which will mean Ireland domiciled ETFs will also be able to benefit from foreign investor interest in accessing Chinese assets.

Taken together, these developments affecting both active and passive funds are expected to increase the number of Chinese and international fund managers establishing funds in Ireland, according to Irish Funds.

Pat Lardner, chief executive of Irish Funds said market data suggests the country is already home to 4.9% of global fund assets and 14.6% of European fund assets.

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