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GSAM to form wealth management joint venture in China

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Goldman Sachs Asset Management and a subsidiary of Beijing-based Industrial and Commercial Bank of China have received preliminary approval from regulators to establish a wealth management joint venture, Goldman Sachs said Tuesday.

The joint venture — to be 51% owned by GSAM and 49% owned by ICBC Wealth Management — will combine GSAM’s “expertise in investment and risk management with ICBC’s strong brand recognition and unparalleled access to retail and institutional clients across China, to create a world-class asset management business,” according to a Goldman Sachs news release.

The tie-up with China’s “preeminent financial institution will accelerate our objective of establishing a leadership position in one of the world’s largest, fastest-growing wealth management opportunities,” Tuan Lam, Hong Kong-based head of GSAM’s client business for Asia-Pacific ex-Japan, said in the release.

With preliminary approval in hand, GSAM and ICBC Wealth Management will hammer out detailed plans for the joint venture and then seek regulatory approval to launch operations, a Goldman Sachs spokesman said.

GSAM becomes the fourth foreign money manager — following Amundi, Schroders and BlackRock over the past 18 months — to move forward with plans to take a majority stake in a joint venture with the wealth management subsidiary of a Chinese bank.

In March, J.P. Morgan Asset Management announced it would acquire a 10% stake in China Merchant Bank’s wealth management subsidiary, CMB Wealth Management Co.