The Bank of China (BoC) is planning to launch a fund of hedge funds (FoHF) in 2010. The FoHF would invest primarily in single hedge fund strategies.

BoC Suisse, a Geneva-based private banking operation launched last November, will establish the FoHF next year, according to a report in the Financial Times.

The newspaper said the project had not yet received regulatory approval by Swiss authorities.

Industry sources told Hedge Funds Review BoC had "bigged up" its Swiss operation considerably. A FoHF launch would be of interest to the market but would come as no surprise, said sources.

The news follows a recent announcement by BoC Suisse that it was launching a range of renminbi-denominated Swiss funds investing in international equities and bonds. Investors are expected to be Chinese high net worth individuals.

The report also said sovereign wealth fund China Investment Corporation (CIC) was understood to be looking at investment in single manager funds and FoHF vehicles.

The Chinese hedge fund industry is steadily growing with the establishment of several indigenous hedge funds operating out of Hong Kong in order to take advantage of the more liberal financial environment that allows shorting of Chinese equities as well as the use of other instruments common on the more developed Western markets.

BoC was unavailable for comment on the latest plans.