The Era of AI Wealth Management
Artificial intelligence (AI) technology is profoundly changing the mode of service of the financial industry. In the field of asset management, this is prominent in Robo-Advisor and smart investment. It is predicted that the scale of investable assets in China will be around RMB200 trillion by 2020, and the total size of Robo-Advisor market will be around 8 trillion by 2020.
With the new regulations on assets management that were formally issued recently, Robo-Advisors came under government oversight for the first time. This means that the landscape of the AI wealth management industry may face a reshuffle. However, in the long run, this is considered to be of great benefit to the AI wealth management industry.
Modern Oversight of Private Equity Funds
As of the end of 2017, there were a total of 22,446 private equity fund management companies in China, with paid up capital reaching RMB11.10 trillion. Among IPOs and NEEQ companies, the number of companies that receive private equity or venture capital investment accounted for more than 60 percent.
The self-regulatory rationale of private equity funds is to give full play to the checks and balances mechanism of market-based credit, with adherence to the nature of the industry by guiding the participation of orderly competition among market players, implementation of self-discipline rules, and survival of market competition through self-credit.
Remodeling the Credibility of Private Enterprises
In recent times, a number of large private enterprises have been experiencing tight liquidity and some even resulted in credit crises, bringing huge shocks to the market. In the bond market, there have been frequent incidents of credit debt defaults by private enterprises. To prevent and resolve financial risks, there is a need to further optimize the business environment and change the credibility system of private enterprises.
Constructing a financial ecological environment that is conducive to the healthy development of private enterprises requires the joint efforts of all parties. The government needs to provide policy support while private enterprises need to focus on their core business and achieve steady progress. Banks need to improve their service capabilities, and treat enterprises with different forms of ownership fairly, under the premise of effective risk control.
Prosperity and Crisis in the Wealth Management Industry
In the past decade, wealth management institutions have mushroomed. In addition to traditional banks, funds, securities and trust companies, there are many wealth management companies, third-party sales companies, Internet platforms, private equity funds, etc. However, some sectors are in a regulatory vacuum for several years.
Wealth management in China sees a coexistence of prosperity and crisis, and failure to attach importance to the crisis can lead to systemic risk for the entire market. The large-scale and complex model of the wealth management market is a test of the ability and energy of regulatory agencies and their ability to ensure optimal regulatory intensity.
The Weighty Task and Difficulties of Pension Investment
By 2016, the gap between the contribution income and expenditure of the employees’ basic endowment insurance fund reached RMB508.6 billion, and the financial subsidies at all levels for the employees’ basic endowment insurance fund totaled RMB651.1 billion.
To fundamentally ease the pressure of an aging population on the pension funds, the current status of an over-reliance of the pension system on the pay-as-you-go scheme for the basic endowment insurance fund needs to be changed. There needs to be a restructuring of pensions and an accelerated development of the accumulation system for enterprise annuities, professional annuities and personal pension savings, so as to establish a multi-level pension system.
