Schroders’ China joint venture with the Mainland’s Bank of Communications has seen a 49% drop in assets in the last three months of 2005. According to The Australian, the U.K. fund manager has been unable to repeat the performance of an earlier joint venture mutual fund launched by Credit Suisse First Boston and the Industrial and Commercial Bank of China, the largest lender on the Mainland. Observers say the earlier success can be attributed to so-called “guanxi” clients, who invested as a favor to business partners, and then shortly thereafter withdrew because they had no interest in investing in the first place, The Australian reports.
