Fidelity International will reshuffle its Asia fixed income investment desk after long-standing team head Bryan Collins leaves on June 30, leading fund research house Morningstar to place two bond strategies under review.
“His expertise and deep grasp of the Asian fixed income market will be missed,” said Morningstar in a client note issued this week.
Marty Dropkin, Fidelity's global head of research for fixed income, will become the new head of Asian fixed income. Now based in London, he will assume responsibility for the team on July 1 and relocate to Hong Kong later in 2020.
Gita Bal, a London-based director on the research team, will replace Dropkin, who has been at Fidelity for nearly 10 years, a spokeswoman told AsianInvestor.
After 14 years with Fidelity, Collins has decided to take a career break, she said. He could not immediately be reached for comment.
His departure has potential implications for both Fidelity's commingled funds and its institutional mandates.
Collins had lead-managed the firm's Asian high yield portfolio since October 2009 and co-managed the China high yield strategy since November 2015, according to Morningstar.
He had lead-managed the China renminbi bond strategy between December 2011 and November last year, when former co-portfolio manager Morgan Lau took over as lead on the portfolio and Collins remained co-manager.
On July 1, Terrence Pang and Ryu Tae-ho will take over as joint lead managers of the Asian high yield and China high yield portfolios. They are currently co-portfolio managers and have helped run the funds since June 2019. Peter Khan will remain as co-portfolio manager.
Pang and Ryu have worked closely with Collins for seven and 10 years, respectively, the Fidelity spokeswoman said.
Collins will remain as a senior adviser until December 31 to help with the transition.
As a result of the changes, the Asian high yield and renminbi bond strategies have been placed under review, Morningstar said in client notes published this week. It does not have analyst coverage of the China high yield strategy.
LONG TRACK RECORD
Morningstar had previously assigned ratings of bronze and silver to the the two strategies, respectively, it added.
The ratings “heavily hinged” on the research house’s conviction in Collins, Morningstar added. “He had built one of the longest track records within the renminbi bond Morningstar category. His expertise and deep grasp of the Asian fixed income market will be missed."
Despite their experience, Pang and Ryu's "investment acumen and dynamics working as lead co-managers are untested", Morningstar said.
Meanwhile, Lau is relatively new to the firm, but he has 12 years of investment experience, five of which as a portfolio manager managing Asian and China bond mandates, added the Morningstar note.
The research firm said it had been under the impression as of this month that Collins was lead manager of the renminbi bond strategy, as it had not been updated by Fidelity when Lau look over. Hence Morningstar will be looking to meet Lau and assess the change, after which it will provide a more comprehensive update on the rating.
As of May 13, the Asian high yield fund stood at $3.86 billion, the China high yield fund at $1.11 billion and the renminbi bond fund at Rmb1.763 billion ($248.2 million).
This story has been updated to reflect that Gita Bal will replace Marty Dropkin and to correct the date when Morgan Lau became lead-manager of the renminbi bond strategy (as Fidelity had initially provided the wrong date).