BlackRock and Fidelity are among the top asset managers who have lost a combined $1 trillion in China’s pension market, according to recent reports. This loss comes as China moves to nationalize its pension system, which has been managed by a number of private asset managers for the past two decades.
The Chinese government’s move to nationalize its pension system began in 2018, and since then, a number of private asset managers have lost contracts to manage the funds. BlackRock and Fidelity are among the largest asset managers who have lost contracts, with BlackRock reportedly losing $430 billion and Fidelity losing $200 billion.
The move to nationalize the pension system is part of a broader effort by the Chinese government to increase its control over the country’s financial system. The move has been met with criticism from some investors, who are concerned about the impact on foreign investment in China.
China banks tap networks for early lead over global rivals.
The loss of contracts for asset managers like BlackRock and Fidelity is significant, as it represents a significant portion of their assets under management. The Chinese pension market is one of the largest in the world, with over $2.5 trillion in assets, making it an important source of revenue for asset managers.
The loss of contracts has also raised questions about the long-term viability of the Chinese pension market. Some investors are concerned that the move to nationalize the system will lead to a loss of transparency and accountability, making it difficult for foreign investors to participate.
Despite these concerns, some asset managers remain optimistic about the future of the Chinese pension market. In a recent statement, BlackRock CEO Larry Fink said that he believed the Chinese pension market would continue to be an important source of growth for the company, despite the loss of contracts.
New market for private pensions could be worth $1.7 trillion.
The move to nationalize the pension system is just the latest in a series of regulatory changes in China’s financial system. In recent years, the country has introduced a number of new regulations aimed at increasing oversight and control over the financial sector.
The loss of contracts by asset managers like BlackRock and Fidelity in China’s pension market is a significant development in the ongoing evolution of the country’s financial system. The move to nationalize the pension system has raised questions about the long-term viability of the market, as well as the impact on foreign investment in China. Despite these challenges, some asset managers remain optimistic about the future of the Chinese pension market, citing its potential for growth and continued importance as a source of revenue.
