Posted inProduct News

Hang Seng IM preps income fund

The firm has co-branded with Ping An to launch the product in Hong Kong.

Hang Seng Investment Management has received regulatory approval from Hong Kong’s Securities and Futures Commission (SFC) to launch the Hang Seng Ping An Asian Income Fund in the SAR, according to the regulator’s records.

The product is a mixed-asset fund investing in Asia-Pacific (ex-Japan) equities and bonds.

This will be the first time that Hang Seng IM has a co-branded product with Ping An, SFC records show.

FSA sought more information from Hang Seng IM, but the firm was not able to provide more details about the product, including the role of Ping An in the fund, in time for publication.

FSA also contacted Ping An Group, but it did not provide more information, noting that Hang Seng IM is the investment manager of the product.

Hang Seng IM manages 40 SFC-authorised actively managed funds and five ETFs, according to SFC.

Separately, Hang Seng IM’s parent, Hang Seng Bank, reported this week that revenues of its wealth management business were 44% down to HK$3.53bn ($460m) during the first half when compared with the same period last year, according to the bank’s 2020 interim report. Overall, the bank’s profit attributable to shareholders was down 33% to HK$9.1bn compared with the first half of 2019 (HK$13.6bn), while earnings per share declined by 34% to HK$4.64.

Income fund popularity

Multi-asset products that provide regular income streams are expected to continue to be in demand in Hong Kong, according to Leena Dagade, associate director at Cerulli Associates.

“In the current market environment, investors are likely to look for low-risk products or multi-asset products that can diversify risks and provide income,” Dagade said recently.

“Just like other markets, Hong Kong investors do look for regular income. As investors navigate the coronavirus-triggered uncertainty, capital protection, reducing downside risks and ensuring steady income will likely be on top of minds,” she said.

Other fund managers operating in Hong Kong are also expected to launch income funds. For example, Alliance Bernstein, Manulife Investment Management, Goldman Sachs Asset Management and GF International Investment Management received approval from the SFC this year to roll out income funds in the SAR.

Similarly, firms in Singapore are also preparing income-generating products. For example, Schroders and Lion Global Investors both recently filed an application with the Monetary Authority of Singapore (MAS) to launch income products.

Part of Mark Allen.