Shares will be repurchased from investors who are willing to sell over the next 12 months.

“The proposed share repurchase may be made on the open market at prevailing market prices in privately negotiated transactions, in block trades or otherwise, from time to time, depending on market conditions,” said the Shanghai-based firm in a statement.

Noah's board of directors will review the share repurchase program periodically, and may authorize adjustment of its terms and size.

There are many reasons why a company decides to buy back its own shares. If it believes its share price is undervalued and much of its stock is held by retail investors (who are more likely to sell their shares than institutions), it may make a profit when the markets rise. Likewise the reduction of publicly-traded shares means its earnings per share increase for non-selling shareholders. Executive compensation is frequently linked to earnings per share targets.

Noah did not immediately return calls for comment on the reasoning behind the share buy back.

Noah has around 600 relationship managers and distributes over-the-counter wealth management products in China, including fixed income products, private equity funds and securities investment funds.