Lombard Odier has been caught up in the suspected suspension of new offshore product sales by the People’s Bank of China.
With Chinese markets off to a volatile start to the year there had been speculation that the Renminbi Qualified Domestic Institutional Investment (RQDII) programme which allows the Chinese currency to be directed into investments outside of China had been deferred.
The Geneva based bank entered into a partnership agreement with Fujian-based Industrial Bank last year to jointly develop a private banking business and offer tailored offshore offerings to Industrial Bank’s high-net-worth clientele.
Too much pressure
Speaking in Hong Kong to the «South China Morning Post» Vincent Duhamel, head of Asia at Lombard Odier was of the opinion that as Chinese clients tried to diversify their investments too much pressure had built up in the system. Products that were legitimately created by financial institutions under the RQDII scheme, however the volumes and the timing are likely to have alarmed the authorities.
A Chinese FACTA
He is confident that the conduit for external investment will return but there may have to be be careful calibration of the programme.
Duhamel also speculated that at some point in the future a Chinese form of the US FACTA legislation would be rolled out by the authorities in Beijing.
