China's National Council for Social Security Fund
(SSF) on Monday signed deals in Beijing with two global investment trustees to
help its upcoming overseas investment operations.
The SSF Council started to seek global investment trustees at the end of
April, and Northern Trust Corporation and the Citigroup Inc. both from the
Unites States were selected.
Although specific overseas investment quota has not been announced, Xiang
Huaicheng, Chairman of the Council, said here on Monday that the fund's move to
invest overseas will avoid risky investments.
The SSF Council was approved by the Chinese government to use part of its
total assets for overseas investment on May 1.
Financial experts believed that overseas investment operations will help the
SSF explore more investment opportunities, diversify investment risks and
maintain and increase the value of the fund.
The fund was set up in 2000 by the Chinese government as its strategic
reserve for its aging population, and its total assets were valued at 201.02
billion yuan (25.1 billion U.S. dollars) by the end of 2005.
The fund mainly comes from budgetary allocation from the Ministry of Finance
as well as revenues from the sale of shares of State-owned firms listed
overseas.
Northern Trust Corporation is a leading provider of asset and fund
administration, investment, management, fiduciary and banking solutions for
corporations, institutions and affluent individuals worldwide.
As of March 16 of this year, Northern Trust was approved by China's banking
watchdog, the China Banking Regulatory Commission (CBRC), to open its first
branch office in the Chinese mainland.
The Citigroup Inc. now has six corporate bank branches namely in Beijing,
Shanghai, Tianjin, Chengdu, Guangzhou and Shenzhen.
The bank has also opened 12 consumer bank outlets in the Chinese mainland,
with 2,600Chinese staff. In August 2006, the Citigroup received a Qualified
Domestic Institutional Investor (QDII) license.
The license will enable Citigroup to make international investments on behalf
of Chinese companies and individuals.
The bank also received approval to offer custodian services to banking
institutions in China that are qualified to provide overseas wealth management
services under the QDII program.
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