Amundi, Europe’s biggest fund house, is laying off the bulk of its investment and operations staff across Hong Kong and Singapore in a post-merger restructuring that will see some 70 individuals leave the Asian business, AsianInvestor can reveal.
The Paris-based firm, with €1.28 trillion ($1.51 trillion) under management after acquiring Pioneer Investments this year, is integrating its Asia equity and fixed income teams into its emerging-market business in London.
Amundi is also transferring some funds to the UK capital to be run by the team there, which includes legacy personnel from Pioneer. Some products will continue to be run in the region.
The move comes amid a tough environment for the investment management industry, with profits being squeezed and a rising focus on cost efficiencies and economies of scale.
Some 50 out of 90 staff in Singapore and roughly one-third of the 65 in Hong Kong will leave Amundi, said a spokeswoman by email. That includes most of the investment and operations personnel in the two locations, said two sources familiar with the fund house.
Chief executive Yves Perrier was quoted in December last year as saying he was looking to cut 450—almost 10%—of its 5,000 staff globally.
The Asia ex-Japan investment team of around 30 across Hong Kong, Singapore and Malaysia will shrink to around 15 by early next year, with the remaining employees needed to help run funds domiciled locally, said the spokeswoman. She declined to say how many of them would remain in Hong Kong or Singapore.
A source familiar with Amundi told AsianInvestor that after the restructuring the firm will have two emerging-market debt managers in Singapore, and in Hong Kong it will retain three equity portfolio managers covering China/Hong Kong, two Indian equity portfolio managers and one quant fund manager. There are around seven investment staff in Kuala Lumpur, the unnamed individual added.
The spokeswoman said the Malaysia headcount would remain intact, as would the two salespeople in Bangkok, the team of nearly 30 in Taiwan, the sales office in Sydney and the staff in Beijing. Amundi declined to comment on whether its Japanese business would be affected.
Vincent Mortier, the firm’s deputy chief investment officer (CIO) and Asia ex-Japan superviser, had told AsianInvestor last month that Amundi would cut fewer than 5% of its 1,398 staff in the region (including those employed by joint ventures) and pare its range of Asia-focused products.
Anthony Ho, Amundi’s former CIO for Asia ex-Japan equities, had left in June as part of the planned integration of Asian equity management into the EM equity team. The firm told AsianInvestor at the time that it was creating “a fully integrated emerging equity group”, but did not say it would cut or relocate headcount.
Other senior executives understood to be exiting are Philip Chow, Asia fixed income CIO, and Tan Jee-Toon, who runs Asean equities, both based in Singapore.
Rajesh Puri, Singapore-based director of fixed income and currency, is expected to return to London, where he had been based previously with Amundi. Multiple sources said only members of the fixed income team in Singapore were given the option of moving to London.
Departures from other parts of the business will include Daryl Ee, head of sales for South Asia, and chief operating officer Winston Thng, both based in Singapore, said sources. A former Amundi employee said Ee’s duties would be absorbed by Southeast Asia CEO Jack Lin and the team, and that a local COO was no longer needed given the departure of most of the investment team in Hong Kong and Singapore.
Amundi declined to comment on individual names or moves.
Most of the equities staff in Hong Kong and Singapore will have left by the end of December, said sources. Some individuals will remain in place until February, they added, as the funds they work on will take longer to relocate to London because of their legal status.
AsianInvestor had earlier this month reported a set of senior departures from Amundi's Hong Kong office, including Ada Mak, Asia head of institutional; China head Michelle Liu; Mounia El Kettani, head of North Asia institutional marketing; Stephen Ma, lead Asia ex-Japan equities portfolio manager; and Kenrick Leung, China equities portfolio manager.
Seeking cost synergies
The spokeswoman for Amundi said the restructuring is in line with announcements made when Pioneer’s acquisition was unveiled in December 2016, with the merger expected to achieve €150 million of cost synergies.
“Part of these synergies will be achieved through rationalisation of operations—where overlapping functions have occurred,” she noted. “These synergies will be implemented across all businesses lines (investment, sales, support and control functions) on a worldwide scale according to local regulation, including Asia."
She added: “We are very mindful of the impact these changes have on our employees and we are working closely with affected individuals to help them through the process.”
Ultimately, the integration and consolidation process will take time, noted the spokeswoman, “and the objective is to create an efficient hub that brings the best of our global expertise to clients.
“We are dedicated to ensure stability, continuity and improved portfolio management and services, especially during this period,” she added. “Also, [the] marketing, sales and client services focus will be strengthened on the ground in order to continue to improve our services to clients in Asia.”
The spokeswoman stressed that Amundi remains committed to the region. The intention is to make Singapore the firm’s global trading hub for Asia by next year, she noted, and in Hong Kong new developments are in the pipeline for the equities management business, such as in the area of smart beta.
The exchange-traded fund (ETF), indexing and smart beta business is a strategic area of development for Amundi globally, said the spokeswoman, and particularly in Asia, where the firm sees a growing appetite for these kind of products.
She pointed to the launch of its Asian ETF platform last year as a key milestone. The firm has listed two products in Hong Kong: the Amundi FTSE A50 Index ETF and Amundi Hang Seng HK 35 Index ETF.
Amundi is not alone in targeting structural changes to its global and Asia business. Many asset managers have undergone defensive mergers or rationalisations, courtesy in large part of falling fee levels and the steady flow of assets from actively managed funds into lower-cost passive vehicles.
Aberdeen Standard Investments and Janus Henderson Investors are also products of recent consolidation, of which more is expected. French insurer Axa is on a big cost-cutting drive, with a merger mooted between Axa Investment Managers and the asset management arm of either BNP Paribas or Natixis.