Abu Dhabi’s biggest sovereign wealth fund has lured a senior executive from Eastspring Investments to head a new portfolio analytics group it has set up for its fixed income and treasury division.

Wee Tian Sing, the former Singapore chief risk officer of Eastspring, will take up the role this week at Abu Dhabi Investment Authority (Adia), a source familiar with the fund told AsianInvestor.

It is understood that Wee will be based in Abu Dhabi and report to Yousaf Sultan Ali, head of operations for the fixed income and treasury department.

The Abu Dhabi fund does not publish its size, but US think tank Global SWF estimates it to be $726 billion, based on an internal model that takes into account allocation and investments.

Wee Tian Sing: new role

Adia declined to comment, including on why the analytics group had been created, whether Wee would have a mandate to hire people for the new team or whether it had similar groups for other asset classes.

What seems clear is that the sovereign fund is putting a greater focus on portfolio analytics, at least for fixed income assets. This reflects a wider trend of institutional investors analysing their portfolios more closely to squeeze out as much return as possible, as they confront a low-yield environment that is expected to continue for years to come.

Interest rates are at ultra-low levels once more after central banks across much of the world cut them to support economies, following the Covid-19 pandemic crisis. And they are seen as unlikely to rise for some years, despite concerns that inflation will begin to rise on the back of pandemic-related government stimulus spending and quantitative easing.

Returns on fixed income assets are most directly affected by low interest rates, and they account for at least 15% to 30% of Adia’s AUM, incorporating credit and government bonds and assets from some other portfolios (see chart below). 

ADIA'S LONG-TERM STRATEGY ALLOCATION, MARCH 2020
(Click for full view; Source; Adia 2019 annual review)

Moreover, asset owners are increasingly investing into data management and analytics capabilities, such as Canadian pension funds and Singaporean state investors, said Javier Capape, director of sovereign wealth research at IE University's Center for the Governance of Change in Madrid.

Various state funds have invested in artificial intelligence, data and analytics companies over the last two years, he added, including Malaysia's Khazanah, Singapore’s GIC and Temasek and Abu Dhabi’s Mubadala.

“Now it is time to start generating changes internally, adapting tools, governance and organisation to a data-driven investment organisation,” Capape said. That will mean we see more portfolio analytics and related roles appearing, he added.

Meanwhile, Wee left Eastspring on April 16 after almost four years at the Singapore-based firm, which is now recruiting for a replacement, a spokeswoman told AsianInvestor. He had joined from Nikko Asset Management.

His departure follows two years of upheaval, turnover and strategy changes at Eastspring, the fund management arm of insurer Prudential Corporation Asia. This most recently involved a move to pare its alternative investment capabilities and place a greater focus on passive strategies.

It has also been affected by the demerger at Prudential parent group level and the decision to repatriate some of the insurer’s assets to M&G Investments, another asset management unit within the group.