Most Asian asset managers are keen on the prospect of regional investment funds in Asia, a quick poll by RBC Investor Services revealed. The poll shows while UCITS products remain the most popular, with 70% of asset managers already involved in UCITS products, about 74% are quite or very interested in the prospect of an Asia Region Fund Passport (ARFP)
The survey was conducted during April to June 2012 and the results reflect feedback from 27 respondents in the Asia-Pacific region. The largest group (41%) were asset managers, followed by investor services providers (19%) and other financial service providers (15%). Others included representatives from private banking, insurance and corporate investors. A significant 59% of respondents were handling assets under management worth $1 billion or greater.
The poll also found that a total of 89% of respondents were confident about the business prospects for the investment management industry in the Asia-Pacific region over the next three years.
RBC last week completed its acquisition of Dexias 50% stake in RBC Dexia Investor Services, making it the sole shareholder. The new entity, renamed RBC Investor Services, found that despite the market volatility and the fragmentation of the regional market in Asia, an overwhelming majority of Asian asset managers were confident in the prospects in the region.
However, says David Travers, head, Asia-Pacific RBC Investor Services, promoters must continually assess their best product, distribution options, and ways to improve operational efficiencies to carve their piece in an increasingly competitive marketplace.
Travers commented: The proposed passport has been widely debated by regulators and market professionals and will continue to be a focus as the fund market keeps growing.
The emergence new investment products such as Renminbi bond funds have generated fresh interest in Asia over the past 18 months. A full 89% of respondents believed the flotation of the Chinese Renminbi currency would be important to the future development of the investment management industry in the Asia-Pacific region.
Widening global access to the Renminbi has spurred the development of new offshore bond funds and products. Flotation of the currency could ultimately drive fresh investment opportunities allowing greater access to the Chinese market, Travers added. Asset managers and their service providers – both locally and globally – are taking notice.
Lastly, the poll found the outsourcing of asset services is less widespread in Asia and remains inconsistent outside more highly developed fund centers such as Singapore, Hong Kong and Japan. However 30% of poll respondents did envisage outsourcing within the next two years, indicating significant demand for outsourcing solutions going forward.
(JDC)