Foreign banks in China are increasingly offering bespoke financial products as they adapt to diverging tastes among investors.
A growing number of products with tailored investment terms, capital returns, structures and trigger events are being sold by Société Générale (China) Personal Banking, according to its head Val Yao.
"Besides the products issued regularly on a weekly or monthly basis, [Société Générale] is also offering customised financial products to experienced investors whose asset net worth is higher than CNY10m," Yao told local media. "Investors should have a sophisticated investment background because banks need to follow China Banking Regulatory Commission (CBRC) directives that products be suitable for their purchasers."
"At present, five percent of Société Générale's clients are involved in tailor-made solutions. Some clients are still in negotiation," he said.
According to Yao, minimum investment barriers have not deterred buyers of more limited means who frequently pool their capital with others to buy into joint investments. Time taken from structuring to launch is usually a month, with the first half spent on customisation, and the second awaiting regulatory approval.
A source at DBS told SRP that more than a third of their monthly structured retail product issuance is made up of similar bespoke products, often purchased by a group of investors as a joint investment.