AMP Capital dismantles Asian equity team

The firm says a review of client investment priorities has led it to globalise its equities focus, hastening the departure of its Asian equities team.
AMP Capital dismantles Asian equity team

AMP Capital is winding up its Asian equity team following a review of internal capabilities and demand from clients. As a result, the five investment professionals in its Hong Kong-based Asian equities team have all been made redundant.

Four team members – Sam Ho, Eugene So, Leanne Li and Vincent Lui – left at the end of March, said a Sydney-based spokesperson for the Australian fund house. Team leader Patrick Ho has stayed on to oversee the closure of the Asian equities capabilities, as AMP Capital's China Growth Fund is wound up.*

AsianInvestor could not ascertain by press time where they might be headed next. 

The spokesperson said the move was part of a wider strategic development that will be announced in due course. 

“We’ve had a look at our Asian capabilities and what our clients want, and we have concluded that they want global equities rather than regional, so as a result we’ve shut down the Asian equity team," the AMP Capital representative said. 

“While Asia remains a critically important market for us, we have decided to cease direct management of China equities and to close our Asian equities capability.”

AMP Capital's global equities team, which is spread across offices in London, Sydney, Hong Kong and Chicago, comprises four members, with a fifth joining next month and a sixth to be recruited in 2018.

The firm's move comes at a time of rising costs and increasingly fierce competition for the investment industry in Asia, with a growing number of players either pulling out or cutting back in the region. BlueBay Asset Management, Syz AM and Edmond de Rothschild are all recent examples. 

Moreover, the trend towards consolidation is accelerating globally among both asset and wealth managers, as shown by the Aberdeen-Standard Life and Janus-Henderson merger deals.

Forced closure

Despite the closing of the China Growth Fund, which came as a result of shareholder activism, AMP Capital intends to continue offering a Chinese equity capability.

“We still manage Chinese equities on behalf of some clients, separate to the fund; this isn't changing,” said the AMP Capital spokesperson. But the firm declined to comment on who would manage the Chinese equity portfolio following Patrick Ho’s departure or if it was still hiring for that role.

Ho reports to David Allen, AMP Capital’s Global chief investment officer for equities, based in Sydney. Ho joined AMP Capital in 2012 as head of Greater China equities and took responsibility for the firm’s China Growth Fund, which at its peak had around A$400 million ($295 million at current exchange rates) in assets.

He was joined at the firm later in 2012 by his former portfolio management colleagues at BNP Paribas, Sam Ho and Eugene So. Hui and Li came on board in September 2015, according to their LinkedIn profiles.

It has been a rocky ride for Patrick Ho, as lead manager of the China Growth Fund, which at one stage traded at a 23% discount to NAV. The fund’s performance was the cause of stern criticism from major investors, including Hong Kong-based Lim Advisors, who in July last year forced a vote to close the fund.   

Globally, AMP Capital has some 900 staff and assets under management of A$165 million ($121 billion) in real estate, infrastructure, fixed income, active equities, multi-manager, and multi-asset portfolios.

*Following publication, AMP Capital's spokesperson contacted AsianInvestor to correct earlier guidance that the winding up process would be completed by the end of the month. The spokesperson said the China Growth Fund had already been sold down, with most of the investment proceeds returned to investors, but that it would likely take between 12 and 18 months from July 2016 to return all the money.
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