US asset manager Thornburg loses outbound investment licence in China
2023.08.11 01:18
By Summer Zhen
HONG KONG (Reuters) – U.S.-based Thornburg Investment Management lost its business licence in China to raise funds for outbound investment only one year after it was granted, according to the China Asset Management Association (AMAC) website.
Thornburg Investment Management (Shanghai) Limited was deregistered as a qualified domestic limited partnership (QDLP) fund manager on July 16, 2023, the website showed.
According to the deregistration category, it failed to launch its first private fund within the required time period of 12 months.
Thornburg did not reply to a request for comment.
The QDLP program, first launched in 2012, allows foreign and domestic fund managers to raise money from qualified investors in China for investment overseas.
Thornburg CEO Jason Brady last year described the receipt of the QDLP licence as “an important milestone” for its international expansion, with the firm looking to serve institutional clients and high net-worth investors in the world’s second-largest economy.
The setback shows how some global fund managers are struggling to raise money in China’s crowded fund market where foreign branding is no longer a key to success.
Thornburg was a lesser-known brand in China, and the product planned was biased towards traditional equity strategies, limiting demand, according to a source familiar with the matter who was not authorised to speak publicly.
As China forges ahead with opening its financial markets to foreigners, an increasing number of global asset management firms have set up shop in the country in the past few years.
However, competition has become intense in the face of a faltering economy and rising numbers of domestic asset managers.
By May 2023, nearly 60 international firms had participated in the QDLP pilot program in Shanghai, China’s financial centre, the local government said. The most recent participants include Wellington Management and Azimut Group.
Fund giants KKR and BlackRock (NYSE:) received QDLP licences last year.
