Posted inBusiness moves

BEA, Harvest to test Swiss-HK MRF scheme

Harvest Global Investments became the first fund house to apply for the mutual fund cross-border sales scheme to tap Swiss investors, and BEA Union Investment intends to follow.

Harvest GI, the international arm of the Chinese fund manager in which Deutsche Bank holds a minority stake, will be selling two Hong Kong-domiciled equity funds – the Asia Frontier Equity Fund and the China Equity Fund in Switzerland, according to the Swiss Financial Market Supervisory Authority (FINMA).

It aims to draw Swiss institutional investors who want to diversify their portfolios, as reported by International Adviser, sister publication of FSA.

The firm debuted a Ucits-compliant China Evolution Equity Fund in April this year, which is also available to institutional investors in Switzerland.

Hong Kong-based BEA Union, the joint-venture between Bank of East Asia (51%) and Germany-based Union Investment (49%), is also applying to distribute two funds under the program.

“The application process is in the final stage and we expect the application will be submitted before end of June,” a BEA Union spokeswoman said.

One fund focuses on Asian fixed income and the other is an Asia multi-asset product, she added.

Other Chinese asset managers are less keen. E Fund Management, Fullgoal Asset Management and ICBC Credit Suisse Asset Management said they have no plans to join the scheme at the moment.

Regulators in Hong Kong and Switzerland agreed to push the program in December last year after the mainland-Hong Kong version was launched in December 2015. But the Hong Kong-China MRF has had an imbalance in both product approvals and fund flows due to China’s concern over capital outflows and muted demand for A-share funds in the SAR.

Ucits funds have been the conventional structure for funds seeking distribution in Europe. But BNP Paribas Securities Services believes there is an appetite for the Hong Kong-Switzerland link, as Swiss investors seek more locally-run Asia-focused products, as reported earlier.

Hong Kong’s Securities and Futures Commission CEO Ashley Alder said he aims to sign mutual fund distirbution pacts with more countries in Europe later this year.


The tree-year performance of the two Harvest funds to be sold in Switzerland through the MRF scheme. The Harvest China Equity Fund uses the MSCI China Index as the reference benchmark, while the Asia Frontier Equity Fund has a customised index.




Source: FE 
All fund NAVs have been converted to US dollars. Note that funds in this chart may be denominated in currencies other than the US dollar.

Part of the Mark Allen Group.