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Written by Selena Lee
HONG KONG (Reuters) – Standard Chartered Bank said in a statement to Reuters that it has suspended new applications for offshore products through quota-based channels by Chinese customers since last week.
The London-based bank cited “commercial reasons” as an explanation for suspending new investments under its Qualified Domestic Institutional Investor (QDII) program. He did not elaborate.
StanChart’s move comes as the Chinese government seeks to stem capital outflows as savers move their assets overseas in response to the weaker yuan and economic slowdown.
Founded in 2006, QDII is one of the few outbound investment channels used by qualified domestic and international institutions to help Chinese high net worth and corporate clients invest in offshore funds, bonds and other structured products. It is one.
China’s yuan faces downward pressure again in 2024, with dollar rebound weighing on market view that the Federal Reserve may wait longer than previously expected to start cutting rates. It’s getting better.
The yuan has depreciated by about 1.4% against the dollar since the beginning of the year.
According to the latest data from China’s foreign exchange regulator, StanChart has won a total of $2.8 billion in QDII quotas since 2006, with HSBC at $4.73 billion and Citigroup at $3.5 billion. It is the third largest after the dollar.
It did not disclose how much of the allocation was used.
(Reporting by Selena Li; Additional reporting by Kane Wu and Samuel Shen; Editing by Sumeet Chatterjee and Jamie Freed)
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