Goldman Sachs reportedly seeks to form JV with ICBC unit to tap into China's wealth management sector
Jan. 16 (NBD) -- Leading global investment bank Goldman Sachs (NYSE: GS)'s asset management arm Goldman Sachs Asset Management (GSAM) is seeking to establish a new wealth management joint venture with Industrial and Commercial Bank of China (ICBC, 601398.SH, 01398.HK)'s wholly-owned subsidiary ICBC Wealth Management Co., Ltd., media outlet Caixin reported Thursday citing informed sources.
The talks are in very initial stage, and GSAM expects to own 51 percent of the planned entity to better its business lines in China, the sources revealed.
When reached by media agencies, GSAM declined to make any comment on the report.
National Business Daily noticed that Goldman Sachs' involvement with ICBC dates back to 2006 when the American investment banking firm purchased a 7 percent stake in the Chinese bank. Since 2009, Goldman Sachs has begun trimming that stake, and eventually exited ICBC in May 2013 through six deals.
With the further opening of China's financial sector, Goldman Sachs is expediting the pace to expand its presence in the country. According to recent reports, the New York-based bank plans to double its workforce in mainland China to 600 people in the next five years.
In addition to Goldman Sachs, other leading foreign asset management companies are on the lookout for partners to tap into the Chinese wealth management market.
Reports emerged in December 2019 said that BlackRock (NYSE: BLK), Singaporean investment company Temasek, and China Construction Bank ("CCB", 00939.HK) have entered into a non-binding agreement to form a JV to offer services such as investment management and consulting in China.