Swiss private bank and asset manager Banque Syz is seeking to partner or acquire an Asian fund firm to expand its presence in the region. It is also mulling opening an office in Singapore at some point, and potentially one in Japan further down the line.
The Geneva-based firm is conducting its current search in Hong Kong rather than Singapore, because the former is more of an international platform and more focused on asset management, Syz owner Eric Syz told AsianInvestor.
Syz, which has around $38 billion in assets under management, is seeking a manager of Asian fixed income or equity or both, with assets of $500 million to $1 billion. “We wouldn’t mind someone with a bias towards China,” said Syz.
The bank had told AsianInvestor in October 2012 it was looking to hire equity and fixed income professionals in the region.
“To be credible in the region you not only need distribution; you need to have a local presence and produce local content,” he added, noting that Syz could also help its prospective partner expand by distributing its products in Europe.
But competition is fierce and costs high to obtain Asia, and particularly China, investment expertise. There are any number of firms with the same objective as Syz, as AsianInvestor has reported.
The bank declined to comment on what progress it had made.
Syz is touting two businesses: wealth management and asset management through segregated mandates for wealthy individuals, family offices and institutions.
The bank set up its Asian operations in 2007 when it opened an office in Hong Kong. It is now staffed by five sales personnel, including Suzanna Wong, head of the team. She joined in July from Swiss & Global Asset Management, where she was head of sales for Asia.
She replaced Daniel Ghirardi, who joined as regional head in May 2010 and left Syz last month. AsianInvestor could not ascertain his next move as of press time.
But with suggestions from fund houses in London that demand for dedicated China funds outside Greater China may be slim initially, continental Europe’s economy in the doldrums and growth in China slowing, is the timing opportune for Syz's move?
“Given that interest rates are so low, the appetite for investment products continues to be relatively high in Europe," Syz said, though he doesn’t see it growing.
“In Asia, it’s a different story. Appetite for investment product is going to grow. A lot of wealth is still invested directly by owners of the wealth, particularly on the family side. This will change over time.”
The bank works under a multi-boutique model for asset management, but all under one brand name.
However, said Syz, “if we buy into a boutique that has a strong franchise and name, we would not kill that name; we would find a way to integrate that name into our firm”.
The firm’s Oyster range of 26 Luxembourg-domiciled Ucits products is distributed in 13 countries. Syz Asset Management runs seven institutional funds, and a further four alternative funds are run by multi-managers under the Oyster brand.
The bank had at one point considered registering its product suite for retail sale in Hong Kong and Singapore, but has not so far done so. It is therefore available only to professional investors.
Syz will start offering its AM capabilities on the institutional side and selling its mutual funds to institutions and high-net-worth individuals. “We’ve been doing this for a number of years out of Hong Kong and aim to expand to other hubs,” Syz said.
Wong said the firm sees opportunities in Korea and Taiwan. “Taiwan institutions are used to buying funds and are gearing towards diversification, and in Korea they’ve been sitting on a lot of cash for a long time,” she noted. “They’ve been looking at liquid alternatives.”
Meanwhile, the bank last month hired Mike Clements from Franklin Templeton in London to replace Eric Bendahan, who left to set up London-based investment manager Eleva Capital. Clements had been manager of the Franklin European growth fund, and now manages Syz’s European opportunities, European selection and continental European selection funds.