Axa Investment Managers is set to relocate its China chief rep Ying Du from Hong Kong to Beijing to establish a rep office there as a key flag in its Asia expansion drive.
The products and advisory firm has a marketing and client services team of 18 in the region working on wholesale distribution to institutions and wealthy individuals via private banks. Of these, eight are based in Hong Kong, eight in Tokyo, two in Sydney and none in Singapore.
It is planned that chief China rep Du will relocate with her family next month, when the rep office is set to open. It will be a homecoming for her, given that she was born and raised in Manchuria in Northeast China.
Du had been working in institutional client services for Axa IM before becoming designated China chief rep about a year ago to lead the licence application process.
Axa IM’s head of sales and marketing for Asia, Terence Lam, confirms that Axa IM received its rep office licence last week. From Beijing, Du will act as liaison as the firm targets institutional assets.
“We see a lot of opportunities coming from China, not purely on traditional assets, but on alternative assets as well,” Lam says.
“On the fund distribution side, we will see what happens with qualified domestic institutional investor (QDII) opportunities. We have started speaking to distributors and QDII providers.
“When the QDII market turns around it will come very quickly and clients will want us to deliver a product in two months, including all the sales. So we need to get well prepared.”
With around 200 sales and marketing staff globally, that puts the firm’s Asia representation at slightly under 10% in personnel terms. It has $665 billion in global AUM, of which $38.1 billion (or 5.7%) was sourced from Asia-Pacific as at the end of last year, by AsianInvestor numbers.
But its Asia presence is something that Axa IM is set on increasing, says its global head of distribution Jon Bailie, who is London-based but spoke to AsianInvestor on a flying visit to Hong Kong.
“We see the potential of Asia and that manifests itself in both the institutional world and the world of distribution by private banks and wealth managers,” he says. “I would very much imagine that over the next two to 10 years we will see more and more resources based here. The balance of what we have got in Asia versus other parts of the world will shift.”
In terms of Axa IM’s key target markets, Lam lists Hong Kong, Taiwan, Singapore, Korea and China. “We also see opportunities coming from other places such as Malaysia, where we have been spending a fair bit of time recently, as well as the Philippines and Thailand.”
From a global perspective, Bailie identifies a few common threads, including a recovery in wholesale distribution and renewed interest in equities amid an increase in risk appetite.
But he confirms that with European indebtedness still weighing heavily on world markets, investors remain cautious in terms of deploying capital, favouring corporate credit and high yield where appropriate.
“Corporate credit gives you some protection if interest rates rise,” Bailie notes. “Further out, there is interest in strategies or funds that invest in inflation protection.”
Bailie notes that Axa IM has largely spent the past year building a track record following a year of gap analysis in 2010. He says AXA IM did create an emerging Europe equities vehicle at the request of an Asian distributor last year.
Lam adds that the firm has also been talking to clients about creating a new product to protect against tail risk in the market.