Irish Funds Asia Pacific Roadshow Summary
The Irish Funds summer roadshow in Singapore, Hong Kong and Tokyo coincided with significant announcements in Asia, most notably the timeline for Shenzhen to be included in the Stock Connect scheme. Irish Funds held 3 successful seminars, with large attendances in each city and featuring panelists from the Hong Kong Exchanges and Clearing, MSCI, Neuberger Berman, Henderson Global Investors, SPARX and a wide range of fund industry service providers. All the seminars were made possible through the support of hosts HSBC Securities Services, PwC and SuMi Trust. The presentations and panel discussions were enhanced by lively Q&A and covered a wide range of industry trends with insights that may prove useful to fund managers and service providers alike.
Highlights and key take-aways from the seminars are as follows:
- A primary discussion topic in Singapore focused on the development of Asian passport programmes with panelists saying more work needs to be done over time to make these effective, especially on the tax side. There is still a market consensus of the passport potential success being “when” and not “if”. Southeast Asia based fund managers are also focused on the new MAS Outsourcing Guidelines which includeddeep discussion centering on the interaction of the requirements with global business models and the way in which managers of differing sizes will adapt.
- Our panel discussions on Brexit in Hong Kong and Singapore suggested fund managers have trepidation about the effect on their business, with the impact varying based on the product, marketing and management passports they currently utilize across UCITS, AIFMD and MiFID. Given deep pools of capital and talent the UK remains an attractive, primary market within which to do business. Ireland maintains its position as a highly effective partner for both UK and Asian managers, as it will be the only English speaking country within the EU with a highly sophisticated fund services industry. Irish domiciled funds continue to provide highly effective distribution access for both UK and European markets.
- The announcement of Shenzhen Connect is creating positive sentiment amongst HK and multi-national fund managers. This panel featured a significant volume of questions from the audience around the topics of taxation, RDVP, the definition of professional institutional investors for ChiNext as well as the removal of the aggregate quota and potential for that to pave a way to MSCI Inclusion. However, MSCI highlighted a few more issues that need to be resolved, suggesting there is no clear timetable to MSCI inclusion, while Shenzhen Connect now has a firm deadline of 4 months.
In Tokyo, the combination of the widening of access to defined contribution pension scheme accounts locally and the continuing search for yield is presenting opportunities both for local Japanese managers developing cross border strategies and managers looking to distribute into Japan. Irish UCITS are acknowledged as an important part of the solution set given their global reach and established track record.