The latest enhancements to the Wealth Management Connect (WMC) pilot scheme in the Guangdong-Hong Kong-Macau Greater Bay Area (GBA) are expected to increase the attractiveness of the cross-boundary investment initiative, a new survey finds.
The online survey of over 2,000 residents in the 11 GBA cities, conducted by HSBC from January to February 2024, reveals that approximately two-thirds of the survey respondents indicated that the latest enhancements to the WMC – including a relaxed entry threshold, extended investment options, and expanded individual investment quota – would drive them to start investing via the scheme or boost their existing investments.
Under the enhancements taking effect on Monday (February 26), all existing and new WMC customers can invest up to 3 million yuan (US$416,785) through the scheme, up from the previous limit of 1 million yuan.
Meanwhile, HSBC and its mainland partner bank have increased the choices of wealth management products to more than 400, including over 100 mutual funds investing in Asia or global markets, helping southbound investors to achieve portfolio diversification and internationalization.
HSBC Hong Kong is also expanding its dedicated team of financial advisers using Wealth Portfolio Intelligence Service, a portfolio analytic tool available exclusively to the bank’s Premier Elite and Premier customers, to provide advisory service to southbound investors to help them better understand the risks and opportunities and hence optimize their portfolios.
Deeper integration
“The latest enhancement to the WMC has further increased the attractiveness of the scheme, fuelling investments and promoting even deeper integration of the financial sector in the GBA,” says Daniel Chan, head of the Greater Bay Area at HSBC. “In addition to opening the door to greater market opportunities, investment channels and diversified investments, survey respondents have emphasized that wealth planning and advisory services are key factors for their increased participation in the scheme.”
With the individual investment quota now increased to a maximum of 3 million yuan, the survey finds that 24% of current investors or those interested in WMC intend to invest 1 million yuan or above via the scheme in the next 12 months.
On average, respondents tend to allocate about 710,000 yuan to the scheme, expecting 7.7% annual return on their investments.
Energy, technology, natural resources, biotechnology and finance rank among the most preferred sectors for investment.
Moreover, 81% of southbound respondents expressed the need for cross-border investment advisory assistance from a bank’s financial advisers.
One of the first banks to participate in the scheme, HSBC currently has 60 Wealth Management Connect centres in the region, supported by a dedicated team of financial advisers to help customers to navigate their cross-boundary wealth management journey.
