Published by Asia Asset Management – 22nd Mar 2019
Scottish asset manager Standard Life Aberdeen’s joint venture with a Chinese company has become the first such tie-up to be granted regulatory approval to operate a pensions business in China as Beijing moves to liberalise the private pension market.
The joint venture company, Heng An Standard Life, will establish a unit to run the pensions business, Standard Life Aberdeen says in a statement on March 20.
Equally owned by Standard Life Aberdeen and Chinese financial conglomerate Tianjin TEDA International, Heng An Standard Life currently offers health, life and savings products in China.
According to Standard Life Aberdeen, the approval for the pensions business “reflects the strength of the proposition and the relationships the company has built in the region”.
“As the pensions market in China looks set to go through fundamental reform to meet the challenges of an ageing population, Heng An Standard Life is exceptionally well positioned to support pension savers in this important market,” Standard Life Aberdeen Chief Executive Keith Skeoch says in the statement.
Beijing has been pressing ahead to open up China’s private pension market as an ageing population puts pressure on the country’s retirement system. It has allowed some cities and provinces to launch savings plans with tax incentives.
The government opened the market to insurance companies last year. Nine insurers, including Heng An Standard Life, have been approved to set up pension businesses thus far.
For Standard Life Aberdeen, the move marks the latest step in its push to expand its operations in China. In 2017, the company received regulatory approval to create and sell investment funds to institutional clients in China through its wholly-owned unit in Shanghai.
Standard Life Aberdeen, which was formed from the merger in 2017 between Standard Life Investments and Aberdeen Asset Management, currently has approximately £551.5 billion (US$728.8 billion) of total assets under management.
