Andrew Kwek, managing director at Morley Fund Management in Singapore, will leave the firm at the end of this month as part of a cost-cutting drive.
Currently Morley's Asia-Pacific (ex-Japan) operations are run by Kwek and CEO Pieter van Putten, who joined the firm in July after taking gardening leave from Commerzbank Asset Management, where he was replaced by Pascal Crepin. Van Putten replaced previous CEO Steven Choi, who left earlier this summer.
"The organization is being restructured to make it flatter and save costs," says Kwek . "Steve and I are being replaced by just one executive." He adds that weak markets have triggered redemptions and falling revenues, and the exercise is required to keep the firm profitable.
Kwek is uncertain of his next move. "It's time to take stock," he says, noting he may return to the industry or move into consulting. He has been at Morley for two years, arriving just before its UK parent, life insurance company CGU, merged its asset management operations with Norwich Union, a UK retail fund manager. His previous role had also seen a merger, handling marketing for Paribas Asset Management when it joined with Banque Nationale de Paris. Before that, Kwek had a career trading foreign exchange.
He believes other global asset managers are going through the same calculations in Singapore. "A lot of companies are seriously considering leaving," he says. "There were a lot of promises to the head office that Singapore and Asia was a growth region. I'd guess 10%-20% of these players have actually done well and the other 80% will see headcount reductions or fold - especially if they're operating hubs in both Hong Kong and Singapore, which is a real drag on revenue."
In addition to poor markets, Morley has sought to diversify its business of late. The UK group manages a total $155 billion, 98% of which is sourced in Britain. Most of this is also institutional money although Norwich Union brought in a large retail business as well. It has had an office in Singapore since 1992, from which it now manages S$5.8 billion ($3.3 billion).
The firm has made a push into Singapore retail, with distribution arrangements hammered out by the local arm of CGNU, which has a joint venture with the Insurance Corporation of Singapore and a bancassurance relationship with DBS Bank. (CGNU and its insurance affiliates have just re-branded themselves as Aviva, although Morley Fund Management will keep its old name.)
Van Putten's priorities will be to expand the retail business, including creating new distribution arrangements by using securities houses or electronic funds supermarkets. He will look at sales opportunities in Hong Kong and Taiwan.
He brings considerable experience in this field, having helped Commerzbank set up very successful JVs in Taiwan, where it owns 25% of Capital Investment Trust, and in Korea, where it has stakes in KEB Commerzbank Investment Trust Management Company.
To learn about the most successful fund management companies in Singapore, see "Friends of Singapore" in the Summer 2002 edition of PensionsAsia magazine.