The newly released wealth management products (WMPs) rules will not bring a flux of bank funds into the stock market in the short term considering banks' investment capability and asset preferences, said Zeng Gang, director of banking research at the Chinese Academy of Social Sciences' Institute of Finance and Banking.

Zeng made the comment amid speculation about potential market volatility when China allows the 30 trillion yuan (4.5 trillion US dollars) WMPs to indirectly invest in stock market.

The China Banking and Insurance Regulatory Commission (CBIRC) issued new guidelines last Friday allowing public WMPs sold by banks to invest indirectly in stocks, in its latest effort to curb shadow-banking and fend off systemic financial risks.

Previously, commercial banks were required to limit their WMPs investment in the money market and bond funds when opening securities accounts with the China Securities Depository and Clearing Corp (CSDC). In a bid to circumvent the rules, most WMPs could only gain exposure to stocks by investing in certain intermediaries such as brokerages and trust companies. Such measures have driven the growth of off-balance-sheet lending.

Zeng said the new rules show the principle of fairness, giving banks' public WMPs the same investment scope as the products of brokers and insurers.

"The whole banking system has a moderate investment style. And judging from the current WMPs layout, which is dominated by fixed-income products, I don't think banks will invest much into the stock market. When the implicit rule of guarantee against default fades out, whether retail investors would accept high risk equity-related products remains a question."