China issues PE fund risk evaluation system
A risk assessment system for private equity (PE) funds has been released in a bid to promote more standardized, scientific and information-based beforehand auditing and progress monitoring.
The system contains a total of 348 items of scoring in 10 professional evaluative categories including investors, management teams, operating conditions, product structure, past performance and credit records.
It was designed by experts, scholars and professional institutions in the industry organized by the Beijing Fund Town, a State-level fund industry cluster in southwestern Fangshan district, after rounds of investigation, systematic argumentation and professional evaluation.
Hu Bo, an associate professor at the School of Finance at Renmin University of China who presided over the design work, said the evaluation system released on Oct 27 will improve China's PE fund management, raise risk awareness and strengthen risk control.
By the end of September, China had 24,399 PE fund management companies and 79,720 private funds registered under the Asset Management Association of China, with a total of 13.4-trillion-yuan (about $1.9 trillion) assets under management.