Earlier, ICBC initiated and joined with other large financial institutions to launch "Ruyi Pension 3", a corporate annuity plan designed for small-and-medium enterprises (SME) in a bid to enrich the product offering to this market segment in China. The "Ruyi Pension 3", the third in ICBC s "Ruyi Pension" product line, fully reflects the substantial strength of ICBC in providing integrated financial services to the SME.
Corporate annuity system has been moving fast in recent years. By the end of 2009, 33500 enterprises in China had set up corporate annuity plan. Yet the vast majority of small and mid-sized businesses is restricted by the employee number and fund size. To them, setting up corporate annuity plan entails high management cost and few investment channels available.
On this ground, starting from 2008 ICBC designed a range of "Ruyi Pension" corporate annuity products tailored for the small and mid corporate segment. As of today, over 2500 small and mid-sized businesses have joined the ICBC "Ruyi Pension" corporate annuity plan, and 620,000 employees have received professional corporate annuity service.
Industry insiders explained the reasons why "Ruyi Pension" is warmly welcomed by the SME. The first reason is that there is no restriction in company size in joining the "Ruyi Pension" corporate annuity plan. Companies who meet the conditions, regardless of size, can join the plan and enjoy the professional, standardized and local management service on the corporate annuity.
The other reason is that "Ruyi Pension" encompasses corporate annuity funds from many trustors, which effectively spreads the cost of account opening, transaction and audit. Meanwhile, the plan uses standard contract and processes. Enterprises enjoy professional annuity fund management services to help them reduce management cost by simply following the easy, standard steps.
As related, the launch of "Ruyi Pension 3" corporate annuity plan is the third product in ICBC "Ruyi Pension" range. ICBC is the trustee and account manager, China Construction Bank is the custodian. ICBC Credit Suisse Asset Management Co., Ltd, BOSERA Funds, China International Capital Corporation Limited are the investment managers.
The product combines the international experience in pension management and local running practices. Besides all the stated advantages, the product is unique in the design, set-up of personalized investment portfolio, management institution and service capacity.
First, "Ruyi Pension 3" is leading the pack domestically in the set-up of personalized investment portfolio. At present, most of the annuity products in China market offer few investment choices for the employees which mean that they have to submit conversion application through companies. This adds workload to the company and no guarantee on the time and efficiency.
ICBC "Ruyi Pension" corporate annuity plan is the first in the country to offer investment options and conversion function leveraged by the strong IT platform of ICBC. Based on the market conditions and portfolio performance, employees joining the plan can easily and flexibly determine the allocation ratio and build own investment portfolio.
Besides, "Ruyi Pension 3" borrows the international experience and adopts the management model of "2+1+N". ICBC is the trustee as well as the account manager, which simplifies the tiresome exchange of information and circulation of documents between trustee and account manager. Processing efficiency is greatly enhanced.
On the other side, China Construction Bank is the independent custodian to render professional custodian service and separate the trustee from the custodian, custodian from the investment manager. This arrangement adds security and independence to the asset of corporate annuity fund.
