China International Capital Corporation is the latest firm to leverage technological capabilities through an agreement to establish a joint venture with a Tencent subsidiary.
Through the joint venture, CICC will contribute its expertise in investment advisory, financial products, asset allocation, risk management and tech know-how in finance and trading. Shenzhen-based Tencent Digital will contribute through its large user base, digital expertise and talent.
The joint venture will include initial capital of 500 million yuan ($70 million) with 51 percent of ownership held by CICC and 49 percent by Tencent Digital, according to a statement. It will first focus on enhancing CICC’s wealth management, retail brokerage and other businesses before potentially extending its services to third party financial institutions.
Secular Opportunity
In addition to business opportunity, the statement added that the move to form such a unit is also a response from the two companies to the «call and requirement of the state and regulatory authorities for the development of fintech».
«Digitalization of financial services provides a secular opportunity for the industry,» said Tencent president Martin Lau. «Combining the strengths of CICC and Tencent, we look forward to offering more customized and differentiated fintech services to users.»
