Bank of Nova Scotia is entering a joint venture with Bank of Beijing by buying a stake in its Chinese asset management arm.
The Toronto company announced Wednesday that it is buying a 33% stake in Bank of Beijing's Fund Management Co. The stake is valued at $15 million. The investment is subject to Chinese regulatory approval.
The venture would take the name Bank of Beijing Scotiabank Asset Management Co. Ltd. It would design a variety of mutual funds and market them to retail and institutional customers through Bank of Beijing's branch network in China.
The Chinese asset management market has had a compound annual growth rate of over 230% over the past three years, according to Bank of Nova Scotia; there are now more than 138 million investor accounts and more than $380 billion of assets under management there.
Bank of Nova Scotia has joint ventures in 11 countries in the Asia-Pacific region. It has had a presence in China since it opened a Beijing branch in 1982.
In China, it also has branches in Shanghai, Guangzhou, and Chongqing, along with offices in Hong Kong and Taipei.
In addition, Bank of Nova Scotia owns 24.9% of Thanachart Bank in Thailand.
Bank of Beijing was established in 1996 from the consolidation of 90 urban credit cooperatives. It has more than 131 offices in Beijing. The company also hasa branches in Tianjin, Shanghai, and Xi'an.