Thailand Financial News

HSBC’s Alternative Fund Services (AFS) fully supports the Singapore Exchange Ltd’s (SGX) announcement that it will permit the listing of hedge funds. AFS sees the announcement as a significant step towards developing Singapore’s commitment to be recognised globally as a natural hub for hedge funds in the Asia region.
Allard de Jong, who heads AFS’s operation in Singapore commented: “This is an exciting development that will bring a further stimulus to the significant growth in the Asian alternative investment fund industry and strengthen Singapore’s drive to be recognised globally as a leading centre for alternatives in the region.” Paul Smith, AFS’s Global Head said: “It’s high time that Asian managers had other options closer to home than Dublin and Cayman.

This move by the SGX should be warmly welcomed as part of a concerted effort to help develop the hedge fund industry in the region.” This move by the SGX will be viewed extremely favourably from global investors looking to invest in Asia’s alternative funds. Whilst still in its early days and a reasonably immature market there is tremendous interest from investors globally to invest in alternative funds in Asia. Much of the interest to invest in hedge funds is from institutions that do not have a mandate to do so. Singapore’s move to list hedge funds will make their allocation decisions much easier. Some institutions are restricted from investing in unlisted securities, or in securities not listed on a recognized exchange such as the SGX. It will provide a great opportunity for some hedge funds to raise further funds. This follows other recent steps to reinforce Singapore’s strong position as a hedge fund centre, including February’s announcement in the budget to encourage domiciliation in Singapore and amend the designated unit trust scheme. The listing of hedge funds will also have a huge impact on the servicing industry. Raising the standard of the information is likely to result in an increased demand for out-sourced support services. As the largest alternatives administrator on the ground in Singapore, with approximately 70 per cent of the local hedge fund business, we see this as a very positive development for our business, as well as the industry. AFS Singapore contributed to the SGX’s consultation process earlier this year and remains actively engaged with its development. Changes in Singapore are similar to those that took place during the last few years in Ireland. AFS has many years of experience operating in Dublin, which has shown that this type of change may have a huge impact, albeit indirectly, on the whole economy by providing high quality professional jobs and raising the profile of the market. Listing hedge funds will provide a further stimulus to the significant growth in the Asian hedge fund industry. It will allow many more pension funds and institutions to invest in hedge funds because they have the reassurance of further due diligence, transparency and regulation to comfort their investment boards. –www.theasianbanker.com (June 30 2006)–