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Chinese family office obtains SFC licences

Hefeng Family Office is now able to conduct advisory and asset management activities in Hong Kong.

The Guangzhou-based multi-family office has obtained last month licences for asset management (Type 9) and advising on securities (Type 4) from the Securities and Futures Commission (SFC), according to the regulator’s records.

Asset management and advisory activities are limited to professional investors, the records show.

The firm’s responsible officers in Hong Kong are Stephen Pau and founding partner Songcheng Jiang. Pau has been the firm’s Hong Kong-based chief investment officer since 2016, according to his Linkedin profile.

FSA sought more information from Pau, but he was not able to provide more details in time for publication.

The firm has been incorporated in Hong Kong since 2016, according to government records.

Elsewhere, the firm has offices in Beijing and offshore centres across Europe, the US and Asia, according to the firm’s website.

Family office demand

Family offices are slowly becoming popular among wealthy Chinese families. Although a majority of them have not used family office services, around 80% of them have become more aware of these firms, with nearly half interested in wealth preservation and inheritance services, according to a joint survey by Bain & Company and China Merchants Bank.

China has also become a target for Hong Kong-based Raffles Family Office, which was established two years ago. Around 95% of its clients are mainland Chinese.

Separately, family offices are believed to be a major driver for Hong Kong’s private wealth industry, according to a survey of asset and wealth managers conducted last year by KPMG and the Private Wealth Management Association (PWMA) in Hong Kong.

Around 41% of the survey’s respondents said that family offices are an increasingly important source of business. In addition, a substantial portion of private wealth AUM is from family offices in various forms, such as single family offices or family offices embedded within the family business, according to the survey.

In a separate study, KPMG and PWMA said that there is an opportunity for Hong Kong to act as regional headquarters for the more established family offices from the US and Europe as they seek to diversify their portfolios in Asia.

“From interviews, several established family offices are moving to set up in the region to benefit from greater proximity to these opportunities,” the study said.

However, Hong Kong is in competition with regional and global rivals. Singapore, for example, has been streamlining the regulatory process and attracting more talent, with the aim of making the Lion City an attractive wealth management hub, according to the survey.

Part of the Bonhill Group.