What happened: Chinese fintech giant Ant Financial has set up a joint venture with the Shanghai unit of US-based asset management firm Vanguard, according to government records. The new entity, listed under Vanguard in the national registry for businesses, has registered capital of RMB 20 million ($2.9 million). Huang Hao, president of digital finance business group at Ant Financial, is listed as its legal representative. Ant Financial holds a 51% share and Vanguard’s Shanghai unit has a 49% stake, according to Chinese media. The scope of business is listed as investment advisory.
Why it’s important: Vanguard, one of the largest public mutual fund providers in the world, launched its Shanghai unit in 2017. The aim of the new joint venture, some experts believe, is for Vanguard to obtain a mutual fund license in China. Chinese regulators have not officially started issuing licenses to wholly foreign-owned enterprises like Vanguard. Ant Financial, which has grown to become the world’s most valuable unicorn in fewer than five years, has attracted the attention of foreign financial service providers. Last September, US-based insurance provider Fidelity Guaranty & Life announced a research partnership with Ant Financial.