(ECNS) -- Chinese banks have rushed to lower the investment threshold of wealth management products (WMPs), with some as low as 10,000 yuan ($1,445), in response to new regulations.
The rules, published by the China Banking and Insurance Regulatory Commission on Sept. 28, have lowered the investment threshold for a single public WMP from 50,000 yuan to 10,000 yuan.
On Sept. 30, China Construction Bank became the first to lower the starting price of one of its wealth management products to 10,000 from 50,000 yuan. China Merchants Bank and Bank of Communications made similar moves.
Yang Huimin, an analyst with Rong360.com, a Chinese provider of customized financing and loan services, said the new rules will help banks foster relationships with new customers, attract more small investors, and increase competition with other products like money market funds.
The once booming market for bank WMP with guaranteed principals will gradually disappear from the asset management industry, Yang said.
