HSBC’s China partner has put a 31 per cent stake in a joint venture on the block which the European bank has a preemptive right to acquire, a disclosure from an online auction shows.

The auction of a stake in HSBC Jintrust Fund Management comes after sources told Reuters in May that Europe’s largest bank was seeking to boost ownership and expand its presence in the asset management market of the world’s second-largest economy.

Chinese state-owned Shanxi Trust, which owns 51 per cent stake in the joint venture, is auctioning off the partial ownership with an asking price of 1 billion yuan (S$187 million), a webpage from China’s National Public Resource Trading Platform shows.

The China fund unit is valued at 3.2 billion yuan, Reuters calculations based on the asking price show.

The auction started to receive bids on Thursday (Jul 29) last week. China Fund News first reported the stake auction late on Monday.

“We are keen to grow our businesses in China, including our fund management JV HSBC JinTrust, which is a strong, profitable business,” HSBC said in a statement responding to a Reuters’ query on whether it was considering buying the auctioned shares.

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“The Group is open to opportunities to expand its businesses at the right moment and that are aligned to its strategic growth plans,” it added.

HSBC Jintrust declined to comment. Shanxi Trust did not immediately respond to a Reuters’ request for comment.

HSBC, which currently owns 49 per cent of the fund unit enjoys a preemptive right to purchase the share, according to the auction page. The bank has not given up the opportunity to exercise the right. Preemptive right allows an existing shareholder to be the first one to refuse auctioned shares.

HSBC is the latest among a slew of global financial firms, following Manulife, JP Morgan and Morgan Stanley , to boost their local presence since China removed foreign ownership cap in 2019. REUTERS