Financial Services in China: High Wealth ahead for Australian Gao Fu
In an Australian first, wealth management company Gao Fu has officially launched its products and services in China through a long-term business partnership with the Chinese Bank of Weifang, writes Sophie Loras.
Australian company Gao Fu recently signed a deal with the Bank of Weifang in Shandong province to provide financial wealth management services in conjunction with its bilingual wealth management IT platform to assist the bank to provide its local Chinese clients with world class wealth management services and RMB investment products.
Under the agreement Gao Fu will provide all of the training for the bank’s financial advisors, extensive Chinese wealth product and market research, IT infrastructure and the back office on a white label or wholesale basis to enable the bank to serve its large wealthy client base.
“This contract is the first of its kind in China we believe,” says Gao Fu founder, chairman and majority shareholder, Geoff Ross.
Gao Fu draws on a technology background and infrastructure models used previously in Australia and then locally redeveloped for the Chinese market using sophisticated Chinese IT resources and infrastructure. The company’s advisory board boasts people from some of Australia’s biggest names including, Macquarie Bank, IPAC, together with international companies including McKinsey, Fidelity, BNP Paribas and Bain, and other important Chinese financial services companies.
All members of the advisory board are Gao Fu shareholders.
“For a relatively young business it has established itself very successfully with a strong, highly motivated loyal group of people,” says Mr Ross.
Mr Ross credits his businesses success to his local Chinese team, working successfully with him in China for many years.
Gao Fu commenced working in Shandong in 2004, and has maintained key senior staff in Jinan, the provincial capital, since 2006 to build brand awareness across the province. Shandong has a population of 100 million and has the country’s third highest GDP. Shandong has 14 city commercial or regional banks located across 14 tier-three cities. Weifang is one of them.
Gao Fu’s success demonstrates the benefits for Australian firms in China using tier-three cities to launch their services.
“We’ve been working in Shandong province since 2004 so it is a province we know very well and like a lot. We know the region at a provincial and local Weifang city level and we always try to structure the business on a win-win long-term basis,” says Mr Ross, who credits the success of the business based on more than 20 years of strong relationship building and experience in China.
“Weifang is a significant city and district of 9 million people in Shandong province. This is an important contract for the bank and for Gao Fu.”
Gao Fu, which means ‘high wealth’ in Chinese, is just one of several businesses Mr Ross has established in China. Gao Fu’s business model is a Hong Kong holding company with a Chinese WOFE (Wholly Owned Foreign Enterprise) structure with a head office in Shanghai.
“My passion is in creating businesses and the opportunities are in China,” says Mr Ross.
“I’ve always really liked working in China. My experience says there is a natural partnership between hard working aspirational Chinese and hard working entrepreneurial Australians,” he says.
The hope is to continue rolling out the Weifang model to other Chinese banks and tier-one cities with the possibility to IPO further down the track.
He says China’s financial sector is still evolving, but unfolding at its own pace.
“Rather than focus on the complexity, our approach is to position our business at an early stage and then let the market unfold while we respond appropriately and creatively within the rules that the regulators determine for the market. This Chinese wealth market has already made huge progress and seen many changes,” Mr Ross says.
“We’ve started a business from zero which is always difficult, that’s obvious. We respond quickly to what’s happening in the market place so as things have unfolded we’ve been able to adjust our business model accordingly utilizing our experience in this market together with the huge resources we have in our advisory board.
Parliamentary Secretary for Pacific Island Affairs Richard Marles representing the Minister for Trade Dr Craig Emerson, witnessed the signing as part of a recent Australian government-led trade mission to China. He said the partnership between the Australian wealth management service provider and the Bank of Weifang, was a clear example of Australia’s proven expertise to help China create a more sophisticated and international financial services market.
“Australia is already providing services to China in banking, insurance, funds management and securities and consultancies and there is plenty of potential for us to do more,” Mr Marles said.
“The Chinese people are looking for a better quality of life, and Australia is well-positioned to help them achieve this.” ■
* Pictured above: Juliet Zhu, CEO, Gao Fu with Richard Marles, Parliamentary Secretary for Pacific Island Affairs, Australia, Shi Yuefeng, Chairman Bank of Weifang and Geoffrey Ross, Chairman, Gao Fu at the launch of the Gao Fu-Bank of Wefang partnership in August.