AsianInvestor's top country funds, Part 2
Every year, AsianInvestor's editorial team conduct an intensive analysis of the region's leading asset management service providers, fund products, and asset managers, to ascertain the top organisations of the previous 12 months.
The winners of these categories must combine a mixture of business performance, growth and progress, on both quantitative and qualitative criteria. Below, we detail why we chose the second half of this year's winners of our market awards category, which comprise the top fund houses operating across key Asia Pacific territories.
KOREA
Barings
While some global asset managers decided to either downsize their Korean businesses or withdrew from the market altogether in 2017, Barings expanded its AUM in the country by 30%, with net assets totalling $12.4 billion as of end 2017. That led it to become the largest foreign equity manager in the country this year. Its flagship High Dividend Equity Fund has constantly outperformed its peers and its AUM almost tripled to $389 million as of end-2017 compared with the year before.
The fund house has built strong and long-term relationships with key institutional clients including major pension providers, mutual aid groups and insurance companies. In addition, it has successfully drawn on the experience of the global investment team and achieved a synergy effect that benefits clients most.
The Seoul-based investment team actively interact with Barings’ 650-strong team of global investment professionals to offer an array of investment products. It is also actively communicating with the global teams to implement ESG in company research and to introduce various developed risk monitoring tools.
The fund house was recognised by the Government Employees Pension Service (GEPS) as an outstanding asset management firm in the pure equity sector during 2017.
MALAYSIA
RHB Asset Management
RHB Asset Management enjoyed strong growth in its mixed asset and Islamic funds in 2017, although assets under management for conventional equity and fixed income funds dropped. Overall, its AUM rose to RM49 billion ($12.7 billion) during the year.
The fund house has made strides on the alternative investment front in recent years. One example is a private equity fund offered to accredited investors in Malaysia, which requires a minimum subscription of RM100,000 (around $25,840); much more accessible than the typical subscription requirement of $250,000 to $1 million.
In 2017, RHB AM launched a listed real estate feeder fund and a sukuk (Islamic bond) fund, which also demonstrated its responsiveness to investor needs beyond conventional equity and bond products. There is steady demand for Islamic products in Malaysia, and the asset manager is also interested in growing its Islamic funds across the region.
RHB AM has kept up its education drive by hosting investment seminars at different locations on topics ranging from sharia investment screening methodology to the influence of sharia stocks on the broader equity markets.
Internally, the asset manager has also been aggressively upgrading its systems and controls to stay competitive.
PHILIPPINES
BDO Trust and Investments Group
BDO Trust and Investments Group is one of only two financial institutions in the country to win accreditation for becoming an administrator for Pera (personal equity and retirement account) schemes.
Pera is a voluntary retirement savings account and as a Pera administrator, the fund house has been able to further intensify its drive to promote financial inclusion across the Philippines.
In 2017, the fund house also remained proactive in widening access to foreign markets through additional feeder funds for Filipino investors Its feeder funds provide investors access to different markets such as the US, Europe, China and Japan. Its international partners include BlackRock, LeggMason ClearBridge Investments group and China AMC.
The emphasis on investor engagement was evident in the asset manager’s decision to overhaul how it communicates market situations and investment strategies to investors. Through the year, it conducted investors sessions in different provinces across the country, explaining market dynamics in more layman terms.
SINGAPORE
JP Morgan Asset Management
Assets under management at JP Morgan Asset Management (Singapore) climbed 36% to $4.2 billion at the end of December 2017; up from $3.1 billion a year ago amid relatively uncertain market conditions. The fund house is particularly strong in multi-asset, a category that has enjoyed high demand from Asian investors. In 2017, the fund house accounted for 15% of all multi-asset net flows in Singapore, according to its own data.
JP Morgan Asset Management continues to use Singapore as its base to expand into Southeast Asian markets such as Thailand and Philippines, adding more feeder funds in those markets while also making further inroads in the insurance-related product space.
Another notable initiative by the fund house was knowledge-sharing with institutional investors. It conducted customised events and training sessions covering topics ranging from strategic and tactical asset allocation to liquidity management and research.
JP Morgan Asset Management services both retail and institutional clients, including sovereign and corporate clients in Singapore and Southeast Asia.
TAIWAN
Pinebridge Investments
PineBridge Investments’ Taiwan unit (PineBridge Taiwan) launched the first-ever Preferred Securities Fund in Taiwan early last year; it was a big success, with its AUM crossing $1 billion by the end of December. This meant that it beat popular ETFs to become the best-selling onshore fund in 2017 in Taiwan. It also meant that PineBridge Taiwan became a top fund house that manages the largest equity fund and fixed income fund for Taiwan. The local unit has been working with global colleagues to structure the product for the Taiwanese market since 2012, before successfully convincing the regulator to give the fund the green light.
After the trailblazer’s success, the fund house launched two more preferred funds and it’s looking to do more this year. Overall, the strength of its new fund helped Pinebridge Taiwan to grow its AUM by 48% to $3.48 billion last year. It provides a great variety of onshore and offshore funds, accessing global financial markets and serving government pension funds services locally.
PineBridge Taiwan is also committed to investor education efforts, which include channel-training and institutional seminars. As one of its banking client noted in a referral letter to AsianInvestor, PineBridge Taiwan won’t magnify back-testing results in its favour to earn business, and it is a very decent long term investor.
THAILAND
Siam Commercial Bank Asset Management
A major player in the country, Siam Commercial Bank Asset Management (SCBAM) manages over Bt1.375 trillion ($44 billion), which accounts for 20% of the overall funds market. It added about Bt70 billion in 2017 alone.
The Thai fund house shows a growing focus on institutional investors, which is part of a strategic plan to penetrate the underserved insurance segment and university endowments in Thailand. Starting from a purely retail business, it has steadily built its institutional business, which accounts for 35% of the overall business mix currently.
It has also taken the lead in harnessing technology to build its quantitative investment capabilities. It has spent around Bt10 million to create dedicated infrastructure for advanced data analytics and launched the first artificial intelligence-driven fund in Thailand.
SCBAM has also developed a variety of online tools for its clients, including ‘Fast Easy’, an information and advisory platform that provides data on historical performance and basic asset allocation to investment outlooks.
In addition, it has organised educational seminars to promote financial literacy and concepts such as long-term asset allocation and portfolio diversification among Thai investors.
VIETNAM
SSI Asset Management
SSI Asset Management has been actively working with local regulators to develop a pensions product industry and regulations to create distressed asset funds. The latter in particular could go a long way in resolving the non-performing loans challenge of the banking sector.
In a fledging market for asset management, SSI AM’s business development team has undertaken a slew of initiatives to educate distributors who, it believes, are key to educating retail investors about the benefits of stock market investing as well of letting professionals manage investments.
While commercial banks currently do not participate in distributing mutual funds, they are expected to become an important distribution channel in Vietnam. In a proactive move, SSI AM has been partnering with commercial banks to introduce mutual funds and discretionary portfolio management services for high net worth individuals and other clients. While online trading of mutual funds was not permitted in Vietnam in 2017, the fund house started preparing its trading platform well in advance in anticipation of a change in regulation. In addition, a revamp of the company’s website was initiated to make it more investor-friendly. It was a sensible move; Hanoi gave online trading the official go-ahead in early 2018.
Look out for explanations of our Marquee award winners, coming soon.
These award descriptions were originally featured in the April/May 2018 edition of AsianInvestor magazine.