Capital Group names new Japan president; Robeco replaces Singapore chief; Hillhouse Capital hires ex-Blackstone MD; Vontobel expands EM debt team; HSBC Global AM names Apac ETF sales head; Manulife creates new digital business role; Stanchart names CIO for wealth management; TMF appoints fund services exec in Shanghai; and more.
He moved from the firmÆs London office last month, partly to replace Thomas Benzmiller, who had run NTGI in Asia ex-Japan but has relocated to a new role in Chicago, but also to oversee the firmÆs Japan operations and a new office in Australia.
Bert Rebelo has also recently moved to Hong Kong to head up product management for the region.
ôWe certainly need more people,ö Hardy says. He hopes to hire two to four more hands in 2009. These include client relations managers as well as a research position for NTGIÆs multi-manager product. The firm has Asia-based clients for its manager-of-managers capability, both long-only and alternative, but would like to have someone on the ground to research regional fund managers, particularly in private equity and hedge funds.
Hardy would also like to have someone to handle transition management deals in the region. NTGI offers transition management to Asia-based clients, or for Asia-focused portfolios, but lacks a person located in the region who can oversee deals, including managing clients as well as the trading desk.
NTGI has offered passive and active investments, transition management, multi-manager solutions and securities lending in Asia since 2005.
Hardy says the firmÆs business is in good shape, with Asian institutional investors such as central banks and big public pension schemes keen to increase allocations to passive mandates. This is particularly true for asset classes such as fixed income and emerging-market equities that previously have not been viewed as efficient enough for passive investing.
He concedes this demand is in part a reflection of the bear market: as investors rebalance portfolios, they find performance among higher-fee active managers in aggregate comparable to the index. But he believes, based on past experience in Europe, that passive mandates are sticky and evolve into core allocations even when markets rebound.
ôItÆs a myth that Asian institutions donÆt invest passively,ö Hardy says. The largest investors need to invest in passive funds because of the unwieldy size of their flows, and because of the capacity constraints of active managers.
Hardy says Asia-sourced assets under management this year is flat, with new mandates compensating for the fall in market valuations. According to AsianInvestor magazineÆs December 2008 issue, Northern TrustÆs Asia Pacific-sourced AUM declined by 7.8% year-on-year as of end-September 2008, to $29.5 billion.
Hardy believes the firm will have a good year in Asia in 2009. The biggest challenge is margins. Many fund management companies are competing by slashing fees, he says. Secondly, the firmÆs securities-lending business û like that of its competitors û is in stasis, because thereÆs no liquidity now to reinvest borrowed securities beyond short-term US Treasuries and T-bills. The firm would like to hire someone in Asia to promote this business, but it will wait until market conditions ease and the sec-lending business returns.
Investors in Asia Pacific will likely see the low interest rate environment as an opportunity to add risk assets in the hope that the economic recovery is on the immediate horizon, but the case for owning gold in portfolios remains strong, according to Jaspar Crawley, Head of Distribution, APAC, at The World Gold Council.
Western asset owners are steadily adding real estate investment capabilities in Asia, while local players have refocused attention onto their home region.
Economic developments in Asia present investment opportunities and current high valuations may be "an accident waiting to happen", say investors.
New European Union regulations being introduced in March will raise the bar for ESG reporting and could well hurt the appeal of energy- and carbon-intensive stocks.