China Everbright Bank and Everbright Wealth Management jointly released the “China Asset Management Market 2024-2025” report on June 6, documenting 10.4% industry growth that expanded the market to RMB 154 trillion. The findings highlight significant transformations in investor preferences and institutional strategies during China’s economic restructuring.
Industry Growth Accelerates Across Sectors
The report identifies three dominant segments driving expansion:
Mutual Funds: Assets surged 16.56% to RMB 43.43 trillion, with public offerings growing 18.93% to a record RMB 32.83 trillion. Notably, 82.4% of funds delivered positive returns averaging 5.06%.
Wealth Management Products: Increased 11.75% to RMB 29.95 trillion, with 98.5% being net-value products. Investor base expanded 9.88% to 125 million, generating RMB 709.9 billion in returns.
Insurance Assets: Maintained strong 20% growth in capital contributions alongside wealth management’s 34% increase.
Risk-Averse Investors Reshape Product Demand
Despite growing financial asset allocations, conservative preferences dominate:
- Deposits, insurance, and wealth products consistently comprise over 50% of new allocations since 2022
- Low-volatility cash and fixed-income products represent 97.3% of bank wealth offerings
- Equity/mixed products stagnate at RMB 800 billion as deposit allocations rise
“The shift toward deposit-like instruments reflects declining risk appetite post-2022,” the report notes, highlighting alignment between product design and investor psychology.
Indexing Emerges as Strategic Priority
In response to interest rate volatility, the report advocates for passive investment strategies:
- Identifies transparent index products as optimal allocation tools
- Notes untapped potential in equity/bond index offerings from bank-affiliated managers
- Recommends prioritizing equity index products as market entry vehicles
Current challenges include limited research capabilities, operational costs, and investor education gaps among wealth management subsidiaries.
Strategic Imperatives for Industry Evolution
The report concludes with key recommendations for asset managers:
- Develop diversified product matrices addressing varying risk profiles
- Enhance international exposure and ESG integration
- Align with national strategic priorities through specialized offerings
As China’s asset management industry navigates structural transformation, the findings underscore both the scale of opportunity and urgency for institutional adaptation in serving the world’s second-largest wealth market.
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