The Hong Kong Monetary Authority (HKMA) has named a new head of private markets for its Exchange Fund to replace Clara Chan, who will leave the investment division to take up a new role at the de facto central bank in October.

Samson Wong, currently head of real estate, will become deputy chief investment officer of private markets, leading the team managing private equity and real estate assets. He currently reports to Chan, but will in the new post report to chief executive Howard Lee, an HKMA spokeswoman said.

She said she could not comment on why Wong’s title would be deputy CIO while Chan’s was CIO, nor on who would succeed Wong. 

Clara Chan: Switching roles

However, a Hong Kong-based executive familiar with HKMA said Wong’s replacement would likely be Melody Chan or Danielle Lau, the senior portfolio managers who oversee US and Asia Pacific real estate investments, respectively.

At the end of 2019 the Exchange Fund had HK$335.1 billion ($43.2 billion) in its long-term growth portfolio (LTGP), which comprises private equity (HK$233.4 billion) and real estate (HK$101.7 billion), according to its latest annual report, published in April.

PRIVATE MARKETS PERFORMING

The LTGP accounts for 8% of the Exchange Fund’s HK$4.195 trillion portfolio and has been a strong driver of performance, recording an annualised internal rate of return of 12.6% since its inception in 2009. That compares to the fund's overall average yearly performance of 2.9% over the same period.

And the private markets allocation seems likely to grow further. HKMA said in the annual report it was deepening “its effort in investment diversification, especially into the long-term growth portfolio”.

Meanwhile, the Exchange Fund has proved fairly resilient to the Covid-19 turbulence this year. It reported investment income of HK$101.4 billion in the second quarter of 2020, largely offsetting the investment loss of HK$112 billion in the first quarter.

For the first half as a whole the fund recorded a loss of HK$10.6 billion, but that does not yet incorporate the LTGP's performance for the second quarter, which is still to be calculated.

CHAN’S NEXT ROLE

Chan is to take up the role of executive director for monetary management at HKMA on October 17, having joined the institution in the reserve management department in 2010. She will succeed Clement Lau, who will leave the institution for personal reasons, it said in a statement.

In her new role, Chan will be responsible for HKMA's work related to maintaining financial and monetary stability through macro-financial surveillance and market operations. She will also be in charge of the regulatory regime on the licensing and supervision of stored value facilities and the designation and oversight of retail payment systems.

A qualified barrister, Chan has been private markets CIO since 2018, before which she oversaw direct investment. She was profiled as one of AsianInvestor's key individual investors of the past 20 years in the 20th anniversary issue of the magazine, which published last week.

Meanwhile, Wong joined HKMA in July 2009 and has since worked in senior roles in private equity investment in the reserves management department, in the risk and compliance department and in the banking supervision department, according to his LinkedIn profile.

Before joining HKMA, Wong had worked in credit derivatives structuring for banks including RBS and UBS.

Joe Marsh contributed to this article.