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Vincent Trouillard-Perrot, CEO for Asia ex-Japan and ex-Australia at BNP Paribas Investment Partners, says the firm intends to develop local investment teams to complement its existing range of global and Asia-focused products currently managed from Paris.
Trouillard-Perrot, universally known as ôVTPö, arrived in Hong Kong in January to lead the Asia business after five years running the investments group in Tokyo. This will be his second posting to Hong Kong, where he once served as a BNP Paribas private banker.
The first item on his agenda is developing a regional portfolio capability; this would be separate from local management teams at the firmÆs three joint ventures, with Shenyin and Wanguo Securities in China, Shinhan Bank in Korea and Sundaram Finance in India.
BNP Paribas Investments now sources around Ç35 billion ($55 billion) from Asia-Pacific, including its JVs, of which roughly 60% is retail/private banking and the rest institutional.
öIn this region we are mainly a distribution platform for products manufactured in Europe,ö Trouillard-Perrot says. ôThese were originally designed for European investors.ö
This means the firm needs to come up with more products with Asian clients in mind. For starters, most of its range is denominated in euros, and it needs more in dollars or local currencies. For certain markets, dividends are more important than in Europe. Funds should cater to home biases and local tastes, which can be more thematic.
In addition, it would need to hire salespeople and product specialists to support any local investment team.
BNP Paribas has analysts and fund managers on the ground in Hong Kong and Singapore but these were hired to slot into global teams. Fischer Francis Tree & Watts, the New York-based bond specialist, is owned by BNP Paribas and has managers in Singapore, but these too work on global, not Asian mandates.
VTP says he would prefer to acquire a local business or lift out an Asian-specialist investment team. But there are few opportunities, and plenty of other firms in the hunt. So while the firm continues to look for deals, it may have to build local capability from scratch. For now the firm wants to establish core, long-only capabilities in Asia, as it wants to capture retail volumes.
In terms of geography, the one big market where it lacks a JV or an onshore business is Taiwan. BNP Paribas has a Sice licence, which lets it market products to local distributors. To date, selling from offshore has been fine. But VTP expects Taipei may follow Korea and introduce tax measures to support locally domiciled funds that invest in international equities, at the expense of offshore products. So the firm is looking at ways to enter the onshore market, whether it is by joint venture, a strategic partnership, acquiring a Site or applying for a Site license on its own.
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