The world of mutual fund distribution in China has advanced another step with the recent licensing of TX Investment Consulting to sell third-party funds. Until now, only commercial banks, securities companies and mutual fund companies have been allowed to sell mutual funds. But the current arrangement has led to a problematic bottleneck, as the banks, in particular the big four state-owned ones, have dominated distribution. The number of fund companies now exceeds the number of fund launches the banks are capable of supporting.
Distribution among banks is in fact likely to be reduced, now that banks are beginning the process of establishing proprietary fund management units. This means up to 25%...
