Royal Bank of Canada announced today that it has entered into a joint venture agreement with China Minsheng Banking Corp., Ltd. (China Minsheng Bank) to launch a new Chinese joint venture fund management company, pending regulatory and other approvals.

The joint venture company, with headquarters in Shanghai, will create, manage and sell mutual funds in local currency to retail and institutional investors in China.

Under the terms of the agreement, Royal will hold a 30% interest in the joint venture, China Minsheng Bank will hold a majority interest of 60%, and Three Gorges Finance Co., Ltd. will hold a 10% interest.

“This exciting initiative provides us with an entry point into the rapidly expanding Chinese asset management market,” said George Lewis, executive vice-president, wealth management, RBC Financial Group and chairman and CEO of RBC Asset Management Inc. “To be selected to participate in this joint venture is a tremendous honour and a reflection of RBC’s leadership in asset management and the distribution of investment products through bank branch networks.”

RBC’s China strategy is to make targeted investments in areas where RBC has global competitive advantages including global debt markets, global financial institutions, private banking and fund management.

“The fund management market in China is poised for growth, making this an opportune time to form this joint venture,” said Hong Qi, executive vice-president, China Minsheng Bank. “It also serves to reinforce the growing realization that Chinese capital markets offer good potential investment value.”

“Each party brings their inherent expertise, knowledge and resources to create a unique and exciting proposition,” said Mike Chen, China country head for RBC Financial Group. “The joint venture will benefit from the expertise in fund management, strategic direction and management capabilities that RBC can provide and the respected, well established presence of China Minsheng Bank.”

China Minsheng Bank is a Chinese commercial bank headquartered in Beijing and listed on the Shanghai Stock Exchange. It has 240 branches and banking outlets in the major cities of China. It ranks among the top ten banks in China with widely held ownership.

In February of 2006, RBC upgraded its representative office in Beijing to a branch, which will enable RBC to provide a variety of services to clients in Canada and China. In August, the company announced the opening of RBC Life Insurance Co.’s new representative office in Beijing. Today, RBC Capital Markets announced its mandate as co-lead manager of the institutional tranche for the Industrial and Commercial Bank of China’s estimated $21 billion initial public offering, the largest in financial market history.