MAS names sustainability head; Malaysia’s EPF appoints COO and CFO; GIC PE head for SEA leaves; State Super hires new exec; Hesta appoints chief growth officer, chief Debby Blakey appointed to corporate governance board; ex-BlackRock exec joins IQ-EQ in Singapore; HSBC AM builds direct real estate team; ex-Vanguard head of distribution joins LGIM; Sanne names Singapore head; and more
The bank is one of 14 commercial banks that since May have been allowed to offer investment products including exposure to a wide range of asset classes, following the China Banking Regulatory CommissionÆs decision to broaden QDII beyond global fixed income.
For now, the total $14.5 billion of QDII quota allocated to those commercial banks has not been taken up by banksÆ customer base. The appreciating renminbi and an overheated market for domestic stocks made QDII a non-starter when limited to global fixed income. Now that the CBRC is letting banks invest in a broader range of asset classes, banks in China, foreign and domestic, hope QDII products will provide sufficient returns to attract investors.
To that end, HSBC has launched three funds with global exposure: the HSBC Investments Global Equities Fund, the HSBC Global Theme Fund and the Merrill Lynch Global Allocation Fund. These will be marketed to mainland high-net-worth bank customers.
To bolster the effort, HSBC plans to hire 1,000 people to provide mainland customers with full service and a broad product choice. It is recruiting relationship managers from major cities across China, not only including first-tier metropolises like Beijing, Guangzhou, Shanghai and Shenzhen, but up-and-coming cities such as Dalian, Qingdao, Tianjin and Xiamen.
The bank has only been allowed to sell such products since April when it incorporated locally, prior to which it could only market investment products to non-residents in China.
ôFor the next couple of years, we have very aggressive growth plans,ö says Lee. ôAnd we want to do it right.ö The first agenda for his troops of relationship managers: preach the concept of good financial planning and risk management.
ôWe hire people with good business sense,ö Lee says. The relationship managers are armed with risk questionnaires, daily market snapshots, weekly newsletters and monthly market analysis supplied by HSBCÆs investment analysts from around the world. ôWe are not in the position to tell customers you should buy this and that. Instead, we are training our front line staff to equip themselves with market knowledge and the understanding of the customers.ö
This army is being taught to recommend appropriate investment ideas based on age, investment experience, income and size of saving. Lee stresses the importance of having long-term investment goals and diversified portfolio of assets û even if this isnÆt exactly what the great majority of mainland investors seem to want in the current bull market.
Lee notes, however, that building proper distribution is a long-term objective, one that must try to steer clear of the industryÆs tendency to base sales upon the latest hot product: ôWe know exactly what kind of business we want to build. While we can certainly put up some products which are more exciting for clients, we are committed to pursue a long-term strategy.ö
Financials and healthcare have been spotted as promising sectors, while several tech IPOs are on the way, including a $2.2 billion fintech firm and a GIC-backed e-commerce startup.
A strong recovery in the Asia Pacific private capital markets in 2021 sets up favourable hiring and compensation trends.
The $95 billion Korean savings will set up a separately managed account for real estate debt investment early next year in order to shorten decision-making and help it win deals in a crowded market.
The fund's 29.6% returns marked its best ever and exceeded its reference portfolio, which has 80% allocated to equities, by 1.73%.