Asia Pacific's family offices are a nimble bunch and never more so than when it comes to ESG where they're already proving to be ahead of the regulators.
He has played a leading role over the past five years in shaping the firm into a success story in the nascent funds industry there. Prudential Vietnam started in 2005 with around $500 million in assets from its insurance parent company and has grown significantly in just two years with around $1.5 billion in assets under management at present.
ôWe have all made significant profits in the biggest bull market Vietnam has ever seen...We now need to be far more rigorous with our investment processes moving forward in order to sustain the progress and take full advantage of the opportunities here,ö he says.
Prudential Vietnam, a subsidiary of the UKÆs Prudential Plc, is one of a handful of fund management companies incorporated onshore with the backing of its insurance parent company. Others include Manulife and AIG. Most other fund management companies are incorporated offshore.
Hambly credits the firm's growth to brand and the group's local credibility, arguing Prudential is the only foreign financial institution operating a signficant onshore operation.
ôIn a market which has a dearth of experienced investment and back office executives we are fortunate that we can look to the Prudential group for its experience in the various asset classes within which we operate - fixed income, public equities, private equities and property - and in critical areas for investors such as compliance, systems and audit,ö he says.
Having the backing of an institution which has $66 billion in assets under management in Asia means having access to its investment professionals, software and systems, which is a big plus for a small market such as Vietnam. In particular, Prudential Vietnam leverages the regional research platform.
ôWhen we buy a listed stock here, we do our research, then we ask our teams in Singapore to look at it. They look at it then they compare it to the regional comps. They give us the international perspective on business models and valuation which we think is needed here in Vietnam,ö he adds.
Hambly notes that Prudential Vietnam has also made a significant investment in its back and front office systems and is now are running its public equity portfolios ôin a very similar way to that you would see in a financial centre like Singaporeö.
On the public equities side, Prudential has a team of eight investment professionals headed by Tran Le Khanh.
Looking ahead, Hambly believes the ôkey criteria for successö for fund management companies will be to have fund managers and analysts with the right skill sets for specific asset classes.
So far, Prudential Vietnam manages two onshore funds and one offshore fund which all invest across the asset classes.
Within the asset classes, Prudential Vietnam has started to build a track record, especially in private equity and now has a portfolio of around 20 companies which also include two management buyouts.
Its first onshore fund is the $1 billion Life fund, which are basically the insurance assets in Vietnam that it manages for its parent company.
The second onshore fund is the $45 billion Prudential Balanced Fund 1, which is denominated in Vietnamese dong, and is only the second listed mutual fund in Vietnam. Its top 10 holdings include Eximbank, Saigon Paper, Saigon Securities, Phu My Fertilizer, and Sacombank.
Its offshore fund, to which Prudential Vietnam is an advisor, is the $300 million Vietnam Segregated Portfolio, which is domiciled in the Cayman islands and listed in Dublin. That fund has been sold through the private banking channels but it also has a few institutional investors. The bulk of the fund raising was done in Asia, with the marketing done in Singapore and Hong Kong.
ôAs we reached the end of last year, we realised that Vietnam was evolving much more quickly than the resources available on the ground were able to keep up with. We didn't believe our business model was going to be sustainable the way it was structured, as this economy grows,ö Hambly says.
ôSo what we've done is focus on the different aspects of the business up and brought in international best practices with the best people we can find in the region within each part of the business,ö he adds.
New investment, finance, compliance and marketing staff have been brought in from around the region and a new CEO was appointed, Pham Ngoc Bich, to lead Prudential VietnamÆs drive into the retail mutual fund markets.
At the same time, Hambly and the investment teams are getting more involved in private equity, direct property investments, and in creating sector- or theme-specific funds.
Prudential Vietnam has a team of four people dedicated to private equity, headed by Craig Martin.
Hambly believes management buyouts (MBO) will provide the best risk returns and the ôhighest chances of successö in Vietnam's private equity market because the management and employees will work harder to get things right. The team is now starting to complete its first two MBOs. It bought out Vietnam Industrial Investments though a company that it incorporated, Corbyns International, and is in the process of completing its second MBO of a seafood processing company.
Property is another area being prioritised for investment.
At present, Prudential Property Investment Management (Prupim) is raising funds for a property portfolio that will invest in Vietnam. Hambly has taken over the CEO role for PrupimÆs business in Asia since September. The Prupim Vietnam Property Fund, which is being sold to institutions, aims to raise around $250 million.
Meanwhile, other plans in the works for Prudential Vietnam include a private equity fund, three more mutual funds, and a unit-linked insurance product. Hambly couldn't discuss these further as the company is still in the planning stages, but he notes the portfolios could be ready for launch within the next six months.
"Prudential Vietnam is going to be quite aggressive," he says, adding he expects the company to be able to double its asset size in the next few years.
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