Asset managers in Japan, Australia lead Ucits fund push
Asia-based fund managers have set up 168 Ucits funds in total, led by firms in Australia and Japan – the regional markets with the biggest pools of pension and insurance assets.
Nomura Holdings tops the tally with 44 Ucits funds as of February 2011, while First State Investments, the asset management arm of Commonwealth Bank of Australia, has 24, according to data from Lipper (click table, below).
PineBridge Investments, owned by Hong Kong’s Pacific Century Group, has 30 funds under the European framework, but it technically falls under a global profile. London-based Yuki Management and Research, which manages a suite of products mostly focused on Japan, has 20 Ucits funds.
Asian asset managers that are targeting large institutional investors view Ucits as “a useful arrangement for fund managers to distribute their funds”, says Lawrence Au, BNP Paribas Securities Services head of Asia-Pacific.
“Ucits [are] distributed in more than 60 countries around the world,” notes Margaret Harwood-Jones, London-based global head of the institutional investor client segment at BNP Paribas Securities Services. “If you are based in Asia and are looking to distribute in Europe, Ucits can be a very easy and straightforward means [to do so].”
Au says the firm has been speaking to more big-name Asian managers seeking to launch Ucits versions of their existing funds. “This trend has picked up over the past one to two years because of the interest from overseas investors in Asian managers' expertise as well as the advantage of using Ucits to distribute to other Asian markets."
Singapore is the world’s third largest market for Ucits funds, after the European Union and Switzerland, while Hong Kong ranks fifth, according to figures from PwC.
Data from the Hong Kong Securities and Futures Commission shows that of the 1,463 Ucits funds licensed for distribution in the city, 62 are run by Asia-Pacific managers, with First State accounting for 26, followed by PineBridge (23), Korea’s Mirae Asset (10) and locally based Hamon Investment Group (3).
In Singapore, there are 3,000 authorised Ucits funds, of which 38 are under the management of Asia-Pacific managers, according to FundSingapore.com. PineBridge accounts for the lion’s share, with 29 Ucits funds, followed by Singapore-based firms Fullerton with five and APS Asset Management with four.
On a regional basis, Asia is the second-largest market for Ucits products after Europe, with 40% of net sales over the past three years coming from the region, according to PwC.
Ucits funds are supported by solid distribution channels and generally good returns. “As a fund vehicle, it has performed very strongly through the crisis,” says Harwood-Jones.
Underlining the growth of Ucits and other areas of asset management in Asia, BNP Paribas Securities Services has appointed industry veteran Connie Mak to the newly created position of North Asia head of relationship management for asset owners, asset managers and alternatives.
She joins BNP Paribas from JP Morgan Securities Services in Hong Kong where she worked for 16 years in areas that included client consulting, network management, client servicing and relationship management.
At BNP Paribas, she will serve the firm’s growing client base of institutional investors that are operating within North Asia and globally, says Au.
"We have a portfolio of both local and global asset manager and asset owner clients based in Hong Kong and other North Asia countries currently serviced out of Singapore that we will move over to Connie's responsibilities immediately,” he notes, adding that the firm has a strong and growing pipeline of clients in North Asia.
The firm plans to expand the securities services unit though more hires across the region in the future, Au adds.