Concerns over Covid-19 cases spiking in Asia? Check. Fast-rising US-China tensions? Check. Canada’s public pension plans are nonetheless sticking to their long-term plans, continuing to build out teams and allocations in the region.
Ontario Teachers’ Pension Plan (OTPP) and Ontario Municipal Employees’ Retirement System (Omers) are two cases in point.
OTPP is opening an office in Singapore and has poached Bruce Crane from Omers to be its Asia Pacific head of infrastructure, Infrastructure Investor reported yesterday. Crane is relocating from Hong Kong to Singapore to start the new role on August 31, having held effectively the same post at Omers, where he had worked since 2012.
These moves reflect plans the C$205 billion ($156 billion) fund had flagged as early as the middle of last year.
OTPP also plans to put a high-conviction equities desk in the Lion City, which becomes its second Asian branch after Hong Kong. Australia and India are other potential future locations in the region.
The Singapore office will, broadly speaking, focus on India, Australia/New Zealand and Southeast Asia, chief investment officer Ziad Hindo was quoted as saying. The Hong Kong branch, meanwhile, will focus on the north Asian markets, including Greater China, South Korea and Japan.
OTPP declined to comment on whether or when further additions would be made to the infrastructure team in Asia, nor on when it would put the high-conviction equities team in Singapore. It also would not say how many staff it would locate there initially.
CAPITAL MARKETS PUSH
Omers, for its part, has just hired another executive to its capital markets desk in Singapore to join two others who came on board earlier this year. The team is now seven-strong, after launching a year ago.
But in recent weeks the C$109 billion ($83 billion) fund has lost David Payne, its Asia Pacific head of private equity, as well as Crane. Jeff French and Derek Ng continue to represent the private equity team in Singapore. An Omers spokesman declined to say whether Payne would be directly replaced, and AsianInvestor could not ascertain his next destination.
Meanwhile, Prateek Maheshwari, who succeeded Crane on the latter’s departure in mid-June, will relocate next year to Singapore from London. Maheshwari was previously a managing director on the infrastructure team.
Omers had launched the Asia capital markets team in July last year by recruiting Ashish Goyal with a view to beefing up its local coverage of publicly traded securities.
The latest hire, Charlotte Tan, took up a newly created role this month as a senior analyst with a focus on regional industrials, energy and materials. She has previously worked in Asia equity research for asset managers Neuberger Berman and DWS.
Tan will “support the research effort across the capital structure of companies we will invest in and help implement the investment process", said Alicia Davidson, HR business partner for Asia Pacific investments at Omers, in a post announcing the hire yesterday on LinkedIn.
Meanwhile, Jessica Zhang and Sarah Chantalle Leong joined Omers earlier in the year as a director with a focus on China and regional consumer and as an associate, respectively.
Leong was an analyst at Morgan Stanley until March, according to her LinkedIn page. AsianInvestor could not ascertain Zhang’s previous role, and Omers could not immediately provide details.
Other large Western asset owners, such as Dutch retirement fund manager APG and Canada Pension Plan Investment Board, are also working to build up their capital markets capabilities in Asia, signalling a nascent but rising trend.
OTPP's latest moves are the natural progression of plans that have been in place for some time, as part of a a strategy to triple its allocation to Asia to around 30% from 10% over the next five years.
Moreover, OTPP’s real estate investment arm, Cadillac Fairview, aims to place staff in Asia for the first time this year, Asia head Ben Chan told AsianInvestor earlier this year.
Such moves reflect a similarly swift buildup of assets and/or employees in the region by other Canadian pension funds, such as CPPIB, La Caisse de Depot et Placement du Quebec (CDPQ) and PSP Investments, as well as the likes of APG.
Demonstrating strong commitment to Asia, these players are clearly willing to take the rough with the smooth. And they seem likely to face ever tougher competition from each other for both investments and talent.