BOCHK praised the MRF, a move it said is a logical follow-on from last year’s launch of the Hong Kong/Shanghai Stock Connect equity market link.

HSBC, the Hong Kong/London-listed banking giant, has already intended it intends to make use of the regime (see here).

BOCHK said it has worked with its parent bank, Bank of China, to “fully prepare for the provision of all-round fund investment services for customers”, it said in a statement.

“In cooperation with BOCHK Asset Management under the group and Bank of China Investment Management under BOC, we have selected a number of eligible funds, including the mainland funds with growth potential for local customers and those launched in Hong Kong with unique features for the Mainland customers,” it continued.

Meanwhile, one prominent bank and wealth manager urged caution about how fast the MRF will affect the market.

Michael Chan, managing director and head of asset servicing, Asia Pacific at BNY Mellon said: “Despite the great opportunities the China retail investor market has to offer, expectation is there will not be a rush of interest straight away and that many fund managers will instead take a more wait and see approach. A number of regulatory and operational requirements still need to be clarified in order to facilitate and attract large scale fund distribution under the MRF scheme. Along with these factors, investment sentiment among Chinese retail investors and their knowledge of mutual funds will decide whether the MRF scheme can and will reach its full potential.”

"The scheme is yet another important milestone towards opening-up China’s capital markets and a great opportunity for the international asset management industry to tap into China’s retail investor market, as well as giving Chinese asset managers access to international investors. Leading up to the introduction of mutual recognition, a number of fund managers have been re-domiciling funds and setting up Hong Kong funds in anticipation, with the number of HK-domiciled funds doubling in the last three years. However, investor sentiment overall to the arrival of the new scheme has been somewhat lukewarm,” he added.