Customised investment solutions alongside unique expertise are the key to growing the private fund business of UOB Asset Management (Thailand) (“UOBAM Thailand”), say its executives. Building trust with clients in the long term can be achieved by providing satisfactory results in their investments.
UOBAM Thailand, a subsidiary of the Singapore-based UOB Group, offers segregated mandate or private fund management services to institutional clients as well as high-net-worth individuals (HNWIs) who are looking for institutional- quality investments. “As the customer base of both segments is expanding, it helps to increase our Assets Under Management (AUM) in this business segment,” says Khetkhan Neesanant, Director and Head of the Institutional & HNWIs Business Department.
Growing private funds
Mr Khetkhan said that the company has been growing the private fund business in line with industry trends UOBAM Thailand sees high growth potential for the segment over the longer term.
According to the Association of Investment Management Companies (AIMC), the country’s private funds had a net asset value of 2.23 trillion baht in the first three months in 2023, an increase of 272 billion baht, or 13.8%, from the end of 2022. However, the strong growth mainly came from government agencies’ specific short-term investment mandates.
UOBAM Thailand expects a positive outlook for the upcoming quarters in addition to the stable AUM growth for the private fund management service in the first quarter of this year. The company has been awarded an additional local equity mandate from a pension fund client, which would facilitate AUM expansion, Mr Khetkhan said.
UOBAM Thailand offers a full range of investment solutions under a private fund service covering both liquid and illiquid investment strategies across a wide range of traditional and alternative asset classes.
“For 2023, we aim to grow the total AUM of our private fund business by double digits. Given a positive outlook for the business segment, we believe we will achieve the target,” Mr Khetkhan said.
The company has been expanding the business for the past several years, in terms of customer base and AUM. These are the results of several factors supporting business growth and attracting customers by providing tailor-made investment
solutions, service quality, unique expertise in business areas and satisfactory performance.
Customer expansion
UOBAM Thailand offers private funds and mutual funds to both institutional and HNWIs investors. Institutional customers include private and publicly listed companies across a broad range of industries, endowments and foundations.
“We have increased long-term investors, particularly insurers and educational institutions. The clients are looking for better returns on investment with acceptable risks. Moreover, we can offer them tailor-made investment solutions,” Mr Khetkhan said.
With tailor-made investment solutions, the company is able to meet the unique requirements of each client’s investment guidelines and restrictions. With these efforts, the company is entrusted by existing customers for additional investment in their portfolios. Furthermore, the existing clients refer the company’s services to others, opening opportunities to gain more customers.
For example, large insurance companies continue to increase their allocations with UOBAM Thailand. Chulalongkorn University has renewed a contract appointing UOBAM Thailand, as a multi-asset private fund manager, investing in local bonds and equities. In addition, several Saving and Credit Co-operatives have chosen UOBAM Thailand as a private fund manager as referred by another satisfied, large saving co-op.
UOBAM Thailand has offered private fund management service for saving and credit co-operative customers for more than eight years. The company has been expanding the customer segment continuously, increasing its AUM from hundreds of millions to tens of billions of Baht at present.
Mr Khetkhan highlighted that savings and credit cooperatives operate under strict regulations. This customer segment has more limitations on portfolio investment. Hence, they need specific expertise of fund management in addition to fundamental analyses such as cash-equity allocation and market factors.
“According to savings and credit cooperative regulations, they are allowed to invest in equity of only a handful of state-owned enterprises. Our portfolio manager team has developed the skillset to help our clients achieve their objectives,” says Mr Khetkhan.
Diversification
Besides searching for better returns on investment, risk management is another key factor for clients. Moreover, most of them also look for long-term investments to mitigate risk. If customers allocate their portfolio investment mainly in the local
market, it can create higher risks when compared to portfolios with diversification in offshore markets.
“Portfolio diversification to offshore markets can help to mitigate concentration risk. At the same time, long-term investment across asset classes with differentiated sources of return is a key strategy to lower volatility. We believe we offer customers consistent performances under the comprehensive risk control system,” says Mr Khetkhan.
After the Fed hiked its policy rate aggressively throughout 2022, the Fed Fund rate is expected to peak this year. Under this scenario, it is an opportune time for bond investments. Also, the volatility in stocks and bonds has shifted investor focus to private assets. UOBAM Thailand also saw increasing demand for private market investment from their clients.
Under the company’s global strategic partnership with global fund managers and the regional bank position of its parent, UOB Group, the investment service of UOBAM Thailand is strengthened. In addition, the company’s investment management team, with extensive experience in both local and international markets, boosts the confidence of customers that they can hit their investment goals.
Sustainability and investment
UOBAM Group is focusing on sustainability by putting environmental, social, and governance (ESG) considerations at the heart of its business.
It strives to create and provide responsible and sustainable investment solutions that can contribute to the long-term progress of local economies and communities.
In January 2020, UOBAM Group became an official signatory of the UN Supported Principles for Responsible Investment (PRI), a testament to UOBAM’s commitment to responsible investing and to developing sustainable investment solutions for customers.
UOBAM Thailand has implemented the twin pillars of sustainability, namely responsible investments, and corporate sustainability stewardship. It believes that responsible investment can contribute significantly to the development of a more sustainable financial system, which in turn benefits the wider community. UOBAM Thailand has also integrated ESG evaluation into its investment process across asset classes. The company is one of the first asset management companies in Thailand to follow the PRI’s guidelines.
UOBAM Thailand won its first ESG award from the Asia Asset Management – Best ESG Manager (Thailand) 2023. Following the win, it received the Best Sustainable Investments, Citywire Asean Awards 2022/23.
Customers looking for investment advice, please call 0 2786 2000 or contact thuobamInstitutional.HNWIs@uobgroup.com or www.uobam.co.th.
