Abu Dhabi Investment Authority and the Kuwait Investment Authority garnered roughly half of the just more than $2.5 billion in quotas issued by China’s State Administration of Foreign Exchange in January for investments by qualified foreign institutional investors in China’s capital markets.
According to an announcement on SAFE’s website, the $627 billion Abu Dhabi Investment Authority in the United Arab Emirates was awarded another $500 million in quota capacity on Jan. 24, after getting a second allocation of $300 million in June 2012. The Abu Dhabi sovereign wealth fund won its first quota of $200 million on Jan. 17, 2009.
The $296 billion Kuwait Investment Authority, Kuwait City, was awarded an additional $700 million in capacity, after getting an initial $300 million quota in March 2012.
In addition, SAFE issued a combined $1.36 billion in quotas to eight first-time recipients:
- Hillhouse Capital Management, $300 million
- APS Asset Management, $300 million
- Genesis Asset Manager, $200 million
- CDH Investment Advisory, $200 million
- J.P. Morgan Asset Management Taiwan, $150 million
- EFG Bank, $100 million
- Public Mutual Berhad, $60 million
- Uni-President Asset Management, $50 million
SAFE also withdrew $18 million of unused capacity from a $100 million quota extended to HSBC Global Asset Management (Hong Kong) in March 2012. In an e-mail, Steve Lee, HSBC Global’s head of China and Taiwan, said HSBC “continues to see growing investor interest in China and will look at opportunities to increase our QFII quota to cater for the needs of our investors.”
China launched the QFII program in 2002 to allow licensed foreign investors to buy and sell yuan-denominated shares in China’s mainland stock exchanges. With the latest quotas, SAFE’s combined QFII quota issuance since the launch of the program comes to slightly less than $40 billion.