Australian fund manager AMP Capital is set to establish a fundamental Asian equities team based in Hong Kong and is weighing up an Asian fixed income presence and new product launches.
The A$125 billion manager – whose client-base encompasses institutional, corporate, superannuation and retail – has hired a trio from BNP Paribas Investment Partners, and is relocating two staff from Sydney. It is seeking to hire an analyst to complete a team of six.
Senior PM Jonathan Reoch will relocate in September to lead the unit as head of Asia (ex-Greater China). He will be responsible for the firm’s Asian equity growth fund, which was initiated in December 2008 and has A$76 million in AUM. Also relocating will be senior investment analyst Casey Mclean.
Externally, Patrick Ho will join as head of Greater China equities and will assume portfolio management responsibility for the firm’s China growth fund, which was incepted in November 2006 and has more than A$300 million in assets. He has spent the past seven years at BNPP Investment Partners as its head of Greater China equities.
He will be accompanied by former colleagues Eugene So and Sam Ho as portfolio managers/analysts. The trio are all due to start on September 12 this year. The team will report to Ella Brown, head of fundamental equities based in Sydney.
A spokesperson for BNPP IP confirms that the trio will leave in mid-September but will continue to manage their portfolios in the interim and will work on an orderly transition. The firm manages $3.3 billion in AUM in Greater China equity from Hong Kong.
BNPP adds that Alex Ng, Asia-Pacific CIO, and Michael Gordon, global head of equities, will oversee the Greater China equity strategy throughout the transition period.
Meanwhile, leaving AMP Capital’s Asian equities team are senior PM Ragu Sivanesarajah (Sydney), PM James Gruber (Sydney), assistant PM Ying Luo (Sydney) and Kevin Yeoh (Beijing).
David Kiddie, AMP Capital’s CIO based in Sydney, tells AsianInvestor the firm has been carrying out a review of its Asian equities capability. “Our belief is we will be better placed if we are on the ground in the region,” he says.
“That is partly from an investment perspective, but also from a client perspective because we believe we are more likely to be successful if we are based in the region.”
AMP Capital manages around A$125 billion in real estate, infrastructure, fixed income, active equities, multi-manager and multi-asset portfolios. Of this, A$8.5 billion is for clients from Asia.
It was the first Australian firm to be granted a QFII licence by China’s securities regulator in 2006. It received its first QFII quota of $200 million that year, followed by an additional $100 million in 2008.
Kiddie confirms it is looking to apply for a third QFII tranche. “As a business we believe Asia as an investment destination is going to continue growing in importance,” he adds. “Having just a China equity strategy and a pan-Asia strategy is not sufficient.”
He indicates that new product areas he intends to explore include Greater China, but he is non-committal on such things as individual country funds and equity income product.
He adds that fixed income is another area AMP is looking at as part of its desire to build Asian capabilities. “We will see further developments over the coming months in that space,” he notes.
Asked about the appetite in Australia for Asian equities exposure, he admits that historically it has been weak on account of a preference for domestic equities.
“We do think that might change over the next few years,” he notes. “But we also have distribution teams in Asia, Japan, London and the Middle East and I am aware of the appetite for Asian equities from other parts of the world. This move [to base a team in HK] is part of that.”
He confirms AMP Capital has no products that utilise a Ucits structure and says that is something it may also potentially look at.
Globally AMP Capital has more than 900 staff, of which 250 are investment professionals.