News from Asian mutual funds has been grim of late, with markets such as China, India, Korea, Taiwan and Singapore reporting net outflows of mutual funds in 2010, particularly in equities.

Invesco says it is bucking the trend, pointing to net inflows of about $1.5 billion from retail and institutional clients based in Asia-Pacific in the first two months of this year. That compares with a net inflow of $2.2 billion from Asia-Pacific funds for full-year 2010.

So does that mean the firm projects the trend continuing throughout 2011? Will its first quarter be as big as all of last year in terms of fund flows?

“You can’t measure it like that,” says Asia-Pacific CEO Andrew Lo in Hong Kong. “There will be ups and downs.” But he says retail sentiment is improving now that markets have made sustained gains since the 2009 trough and regulatory changes to distribution have become clearer.

According toAsianInvestor research, Invesco manages $54.2 billion of assets from clients based in Asia-Pacific as of September 2010, a figure that represented a 48% rise from 2009. It is ranked the 33rd biggest manager of Asia-Pacific assets, and 20th out of firms based in the US or Europe.

Last year’s gains came from offshore funds sold to investors in Taiwan and Hong Kong, and that trend continues into 2011, Lo says.

In 2010, the firm’s joint venture in China, Invesco Great Wall, suffered a modest net outflow, but this has turned positive in 2011. The firm is also seeing inflows to its QFII and Greater China strategies from clients around the world.

Onshore fund businesses have varied. The Japan business, augmented by last year’s acquisition of Van Kampen Investments from Morgan Stanley, which brought with it a substantial Japan equities team, experienced net positive retail flows in 2010. The Taiwan onshore business “continues to be difficult”, Lo says.

Two thematic products have done best in this region: Asian infrastructure funds and Asian consumer-demand funds. Lo expects those themes to remain attractive to investors.

Meanwhile Invesco intends to beef up its Asian debt team, including additional hires to an existing team headed by Frankie Tai that runs balanced mandates for both the MPF and the cash markets in Hong Kong. Late last year the firm also raised around $100 million for a private placement for offshore renminbi investments in the Hong Kong CNH market.

The JV in China is also about to launch its first bond product, although it already runs money-market funds.

Invesco has seen its regional business expand last year via M&A, with the inclusion of Van Kampen’s Japan funds business and the Asia real-estate investment business of AIG. It has also grown its Australia teams in Melbourne and Sydney.