The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
Mercer Human Resource Consulting interviewed 73 employers of varying size and found that they are satisfied with investment performance and administration, says Jennifer Chee, director of retirement consulting. The survey included both companies using just MPF or using MPF plus an Orso [Occupational Retirement Securities Ordinance] scheme.
But another survey by Principal Asset Management reveals that high-income employeesÆ current retirement savings are inadequate to meet their expectations.
Mercer asked employers to rate their investment managers, trustees and administrators based on what providers had promised. Employers largely expressed satisfaction regarding service and designs of benefit structures. (Mercer did not ask about investment performance.)
The only dark cloud: fees. ôMost employers rate their existing managers as good or very good, except for fees,ö Chee says. ôOnly 30% of employers were satisfied; the rest said there was æroom for improvementÆ.ö
Another issue was governance in MPF. Although employers didnÆt say they are unhappy, Mercer found that as assets under management have risen, more employers are realising they need help in this area. For example, there is no formal process or mechanism regarding administration or transparency of MPF scheme workings for members.
ôThereÆs no regulatory requirement regarding governance,ö Chee says. ôEmployers need to enhance their monitoring processes over service providers. They need staff to conduct regular reviews and they need better documentation; itÆs hard to review service providers without better documented agreements.ö
PrincipalÆs survey reveals that over half of high-income people (with earnings HK$25,000 per month or more) say their current pension scheme is insufficient for their retirement needs. And for lower-income workers (HK$10-15,000/month), more than 70% say their pension scheme is inadequate.
High-income people on average say they will need nearly HK$17,000 of monthly expenditure after retirement, including healthcare and leisure costs. But given current inflation and salary trends, they will use up their expected pension savings within 15 years û less than the average life expectancy post retirement in Hong Kong. The great majority of respondents say they need to achieve the shortfall through their own investment returns, and only one-fifth say MPF or Orso savings will be their major source of retirement savings.
While 85% of high-income people have begun this preparation, with investments in stocks, mutual funds, insurance savings plans and savings deposits, they are apathetic toward MPF. Roughly the same portion of people say they have never changed fund choice, and half have not reviewed it.
Although most people say, therefore, that they realise they need to invest more for retirement, few seem to rely on MPF or corporate pension schemes, and only a fifth take advantage of MPF or Orso member choice options. Yet Principal, an MPF service provider, says this means the government should therefore raise the maximum MPF contribution level from HK$20,000 to HK$30,000.
Record low borrowing costs in Australia are feeding demand for the country's real estate, with domestic and global investors raising their allocations into the sector.
Experts have a diversified view on the appeal of private assets across the region, but one thing's for certain - inflows are rising, particularly into China and the US.
Malaysia's Armed Forces Fund hires new CEO; Canada's Omers appoints Asia capital markets managing director; HSBC Asset Management creates alternatives unit, appoints CIO as its head; Bank of Singapore names global wealth head; Aware Super hires IFA head; Hong Kong names acting head for MPFA; Schroders adding to Asia ESG headcount; and more.
Asian fixed income assets – including Hong Kong dollar (HKD) bonds – are luring growing numbers of global investors who are striving for reliable and consistent returns amid macro uncertainty compounded by rising inflation and rates, according to HSBC Asset Management.