China May Ban Some Banks from Wealth Management: Herald

Chinese commercial banks that have not set up a wealth management subsidiary may not be able to add new wealth management services as authorities try to limit financial risks growing out of the sector, the 21st Century Business Herald reported citing three independent sources. Medium and small-size banks are gradually withdrawing from wealth management business, as local banking regulations in the first half have limited their growth, the newspaper said. This may significantly impact small banks, and may cause unemployment, as the scale of wealth management business generally accounts for 10-30% of the entire bank's assets, the newspaper said citing an industry insider. In the past, small banks carried out much asset management business through outsourcing as they lacked resources and expertise, the newspaper said.