Taikang Insurance building out offshore investment arm
Beijing-based Taikang Insurance is substantially expanding the headcount at its international investment arm in Hong Kong, reflecting a trend among its domestic peers to build out overseas capabilities and client bases.
Taikang Asset Management Hong Kong is looking to hire at least seven staff, according to recent online recruitment postings. They include at least two portfolio managers, an analyst, a sales executive for high-net-worth clients, a senior compliance officer and administration and operations executives. And in June it added a new institutional sales executive, Teck Ng.
Taikang AM HK aims to expand the Hong Kong headcount, which is currently around 60-strong, Ng, the newly appointed director of sales and marketing, told AsianInvestor, declining to put a number on how many staff it was adding. "The company looks to continue growing assets managed for institutional and professional investors globally,” he said.
About half the firm’s assets are managed on behalf of the parent group, Taikang Insurance, which has Rmb1.5 trillion ($219 billion) in insurance assets under management (AUM) and Rmb300 billion in pension assets, according to its website.
The rest of Taikang AM HK's AUM come from external clients, such as sovereign wealth funds and insurers in the region. It offers strategies such as China offshore equities, global equities and Asian fixed income.
Ng, who declined to specify how much the Hong Kong unit had in AUM, focuses on sovereign wealth funds, pension funds and insurers in Asia. Reporting to Raymond Sze, head of product, sales and marketing, Ng is also responsible for environmental, social and governance (ESG) aspects of the business, both internally and externally.
Taikang AM HK’s incoming portfolio managers – one covering A-shares and another Asia Pacific and Asean equities – will report to the firm’s chief investment officer, Jim Chen. The new equity analyst will focus on the internet and consumer discretionary sectors and report to the head of equity research and investment.
It seems likely that Taikang Insurance will seek to increase its overseas investment exposure, but Ng declined to confirm that. The average foreign asset allocation of Chinese insurance firms remains well below the 15% regulatory cap, .
OFFSHORE EXPANSION TREND
Some of Taikang’s larger domestic rivals, such as China Pacific Insurance (CPIC) and Ping An, are also moving to build out their offshore asset management businesses with a view to both expanding their external client base and diversifying their internal investment portfolios.
AsianInvestor reported in April that CPIC was aiming to double the number of staff in its Hong Kong-based overseas investment platform within three years, while as of last year Ping An was aiming to boost its offshore assets under management fivefold to more than $100 billion.
However, Chinese asset managers may face hurdles to their international ambitions. While they have extensive experience and knowledge of mainland markets, most lack robust international distribution teams catering to investors in Europe or the US, though they are often willing to charge lower fees than their Western peers for China-focused strategies.
Moreover, international fund houses are keenly expanding operations in mainland China, and Western institutions – at least those less familiar with investing in China – tend to hire asset managers that they are already familiar with.
Further complicating Chinese firms’ overseas plans are persisting geopolitical tensions between China and the West, potentially hindering relationship-building efforts with international investors, particularly those in the US. The Trump administration is pressuring US pension funds and endowments not to invest in Chinese stocks, citing national security risks.