News

First take Singapore's GDP contracted 3.7 percent year-on-year in the fourth quarter, after a revised 0.2 percent contraction in the third. On an quarter-on-quarter annualised rate, GDP was 16.9 percent lower. The numbers are much worse than expected. Growth for 2008 in total was 1.2 percent year-on-year.

Hong Kong-based asset management firm, Enhanced Investment Products Ltd. (EIP) announces strong results despite the current economic climate demonstrating that its market neutral Overlay Fund offers absolute returns. Year-end results show the EIP Overlay fund is up 17.31 percent, in comparison to the MSCI Emerging Asia Index which was down -54.09 percent (January to December 2008).

Hong Kong and Singapore may soon come under increased scrutiny from the US, if incoming President Barack Obama follows through with his pledge to crack down on abusive “tax havens” which “peddle secrecy” and “cloak tax evasion and other misconduct,” according to Withers, the world's leading law firm for high net worth individuals.

Singapore bond markets closed the year on a strong note and turned in positive performance for December. The UOB Singapore Government Bond All Index gained 1.33 percent for the month. Singapore government bonds benefited from a worsening in the global recession and a subsequent rally in global bonds, and yields reached new lows for the year. As economic data continued to weaken, officials acknowledged the worsening domestic economic outlook. This acknowledgment supported investors’ bias for the relative safety of bonds. However, as the market adjusted for new supply and some profit taking, some of the gains were pared back. Although the market remained flushed with liquidity as overnight interbank rates eased by an additional 12.5 basis points (bps), investors’ desire for higher yields amid falling inflation promoted a further flattening of the yield curve. The 2/10 year Singapore Government Securities (SGS) yield curve compressed by a further 20 bps in December, while 2-, 5- , 10- and 20-year SGS benchmark yields were lower by 2, 15, 28 and 33 bps respectively.

Nomura Asset Management, a leading Japan-based investment manager, and the Board of Directors of Nomura Partners Funds, Inc., formerly known as The Japan Fund, Inc., the United States' oldest Japanese equity mutual fund, announced today the launch of Nomura Partners Funds, Inc. (the “Funds”), a family of mutual funds with an Asian and global focus. The Funds will give investors the ability to choose from a variety of Asian and global funds, providing them with “The World from Asia.” Nomura Asset Management U.S.A. Inc. will be the investment advisor for the Funds and each Fund will be managed by a team of investment specialists with one overriding goal: competitive performance.

uperDerivatives (SD), the derivatives benchmark, reports significant growth in Q4 of 2008 over the previous year, with 83-percent growth in new customers and renewals in December alone, as demand from institutions in driven by cost control and the need for pricing transparency and accurate risk management in derivatives.

HSBC has started operating its locally incorporated entity on January 1, 2009. This makes HSBC the first foreign bank to incorporate locally in the fast-growing Vietnamese banking sector after gaining approval from the State Bank of Vietnam (SBV) to set up a Wholly Foreign-Owned Bank (WFOB) in Vietnam in September 2008.Local incorporation will enhance HSBC’s presence as part of its dual growth strategy for Vietnam, comprising strategic alliances and organic expansion. The new entity, HSBC Bank (Vietnam) Ltd., is headquartered at the Metropolitan Building, 235 Dong Khoi Street, in Ho Chi Minh City’s District 1—right in the heart of Vietnam’s dynamic southern commercial hub, along one of its busiest and most well-known thoroughfares. With a registered capital of VND3,000 billion (approximately US$177 million), HSBC Bank (Vietnam) Ltd. is 100-percent owned by The Hong Kong and Shanghai Banking Corp. Ltd.Thomas Tobin, president and CEO of HSBC’s current operations in Vietnam, has been appointed CEO of the new locally incorporated entity. He said: “This is a great milestone for HSBC in Vietnam. It demonstrates the Group’s continued growth in emerging markets and commitment to the development of Vietnam’s financial and banking sector. Despite the turbulent market conditions in 2008, we continue to see the underlying potential of the Vietnam economy, with its dynamic workforce, stable government and rich natural resources. Following the ascension of Vietnam into the World Trade Organisation [WTO], the Vietnamese Government quickly implemented reforms to the financial sector. Our ability to locally incorporate is a tangible example of the Government’s willingness to welcome foreign investment to Vietnam. Operating as a locally incorporated entity will enable us to increase our participation in the country’s fast growing economy and financial markets, utilising HSBC’s international banking expertise and world-class banking services.”On January 1, 2009, HSBC has converted all assets and liabilities of the current operations of HSBC Ho Chi Minh City Branch and certain assets and liabilities of HSBC Hanoi Branch to HSBC Bank (Vietnam) Ltd. As a result, all contracts, accounts and records of its customers, partner banks, suppliers and other parties were automatically transferred to the new Bank. The Bank has taken great care to minimise any disruption to customers.Mr Tobin added: “This is an important landmark achievement in the Bank’s 138 years of history in Vietnam. In recent years, we made great progress in our strategic investments in Techcombank and the Bao Viet Group. Now, local incorporation will give us a wider platform to enhance our scope of services and reach more international and local customers.”In addition to converting its existing operations in Ho Chi Minh City and Hanoi, HSBC also plans to open a new branch in Binh Duong Province soon. Subject to appropriate approvals, seven more outlets will be opened in the country in the first quarter of 2009.HSBC operates one of the largest foreign-owned banks in Vietnam. It also holds 10 percent of the share capital of Bao Viet Holdings, Vietnam’s leading insurer, and 20 percent in Vietnam Technological and Commercial Joint Stock Bank (Techcombank), one of Vietnam’s largest joint stock banks.

Aberdeen Asset Management PLC (‘Aberdeen’ or ‘the Group’) announced its entry into a definitive agreement with Credit Suisse Group AG (‘Credit Suisse’) to acquire certain fund management assets and businesses (‘the Acquired Business’, ‘the Acquisition’), subject to shareholder and certain regulatory approvals.The purchase consideration will be satisfied by the issue to Credit Suisse of amaximum of 240 million new ordinary shares in Aberdeen, equivalent to 24.97 percent of the enlarged Group’s issued ordinary share capital, valued at £250 million based on the Aberdeen closing share price of 104.25 pence on December 30, 2008. The actual number of new ordinary shares to be issued to Credit Suisse will depend on the level of run-rate revenues delivered at the closing of the Acquisition, which is anticipated will take place on, or around, June 30, 2009 (‘the Closing’).The assets under management (‘AuM’) the subject of the Acquisition were CHF75 billion (£40 billion) as at November 30, 2008, with associated run-rate revenues of approximately CHF220 million (£118 million) per annum and were this level of run-rate revenues to be delivered at Closing, the maximum purchase consideration of 240 million new ordinary shares would be payable.The Acquired Business is a long-only traditional asset manager with a leading presence in Europe, Asia and Australasia. It offers a broad product range, diversified predominantly across fixed income, money market and equities, with a variety of investment styles that will be integrated into Aberdeen’s investment processes. Its products are sold primarily to third- party clients, with a significant minority of assets sourced through Credit Suisse’s Private Banking division, one of the world’s largest wealth managers.Aberdeen has agreed an extension of the existing distribution agreement with Credit Suisse, to be signed on Closing. This will give Aberdeen greater access to the banking network of Credit Suisse.

Moody's Investors Service announced on January 9 that it has put on review for possible downgrade the Aaa rating of Vesta Investment Corporation Ltd. (Vesta or Issuer). The transaction is originated 50/50 by CapitaLand Residential Ltd., the residential arm of CapitaLand Ltd., and Lippo China Resources Ltd. The transaction is a cross-border securitisation backed by residential unit purchase receivables of two yet to be completed residential projects in Singapore, namely Scotts HighPark and The Metropolitan Condominium. As of transaction closing, 100 percent of the units were sold under a Deferred Payment Scheme.

Western Asset Management, the leading global fixed income manager wholly owned by Legg Mason, Inc., said that continued slowdown in the global economy and the subsequent policy reactions will likely remain the dominant theme in Asia. Growth in China will be an important factor for regional economic performance in 2009 given China’s role as an export market for many Asian countries.

The Board of Banyan Tree Holdings Ltd. (“BTH” and together with its subsidiaries, the “Group”) announced that after the completion of its third closing (the “Third Closing”), Banyan Tree Indochina Hospitality Fund, L.P. (the “Indochina Fund” or the “Fund”) has a total amount of US$268 million in capital commitments from investors. The First and Second Closing The Indochina Fund is a real estate development fund, established by BTH on 29 January 2008, primarily focusing on the hospitality sector in Vietnam and also in Cambodia and Laos. Its principal project is Laguna Hue, an integrated resort development in Central Vietnam. On 28 February 2008, the Group and two Anchor Investors, via a Feeder Fund, committed to invest, in aggregate, US$100 million in the Fund. In July 2008, a number of other investors committed to invest, in aggregate, US$68 million. Accordingly, after the Second Closing in July 2008, the Fund’s total capital commitments reached US$168 million. The Third Closing Demonstrating their commitment to, and confidence in the long term success of, the Vietnamese economy and tourism industry and, more importantly, the Laguna Hue project, the Group and each of the Anchor Investors have increased their respective commitments by US$16.7 million each to an aggregate of US$50 million each. These increases in capital commitments bring the total commitments from the Group and the Anchor Investors (via the Feeder Fund) to US$150 million. In addition, the Fund has also successfully received a commitment of US$50 million from an investor which is to be made via the Feeder Fund. These new commitments bring the total capital raised by the Fund to date to US$268 million. This significant increase in total capital committed means that the Fund is well placed to proceed with the development of the first phase (as described below) of Laguna Hue, without the need to rely on debt financing. Laguna Hue located within an hour’s drive from both the Danang and Hue airports, Laguna Hue envisages the development of seven resorts (including one Banyan Tree resort and one Angsana resort), award-winning Banyan Tree and Angsana Spas, an 18-hole golf course, extensive MICE facilities and retail outlets. Residential villas and apartments will also be available for sale. To enable the core components of an integrated resort to be in place as soon as possible, the first phase of Laguna Hue has been redesigned to comprise the Banyan Tree and Angsana resorts and spas, residences for sale as well as the 18 hole golf course and clubhouse and related infrastructure. This platform is intended to enable Laguna Hue to generate initial cash flows as well and place the Fund in a better position to attract debt/equity financing for the remaining phases of the master plan. Construction of the first phase of Laguna Hue is anticipated to commence in the first half of 2009. Solicitation of further capital commitments The Fund, will continue fund raising activities to seek further commitments from investors by the final closing date which is expected to occur in the first quarter of 2009.

I Romesh Navaratnarajah sincerely apologise to Taishin Financial Holdings and Mr. Julius Chen for the article titled “Financial scandal rocks Taiwan” which was published in the August/September issue of the Asian Banking and Finance Magazine. I admit and take full responsibility for the below-mentioned facts that were untrue and negative with regards to Taishin Financial Holdings and its previous President, Mr. Julius Chen.

Standard Chartered Bank announced the expansion of its Fund Services coverage to ten full service centre locations throughout Asia including Hong Kong, Singapore, Thailand, Indonesia, China, Philippines, India, Taiwan, Malaysia and Korea. The bank’s core fund services capabilities and activities have also been enhanced with the roll out of new “best of breed” systems for accounting and alternative fund investor servicing. These enhancements provide clients with single and multi-market solutions across an increased product and asset range together with improved local language and customised reporting. Alastair Pow, Global Product Head, Fund Services, Standard Chartered Bank said, “At Standard Chartered Bank we are continuing to invest in expanding our Fund Services capabilities for clients. This year alone our focus on supporting our clients with the solutions and advisory they need has enabled us to grow market share and deliver double digit growth. We will continue to strengthen our strong focus on Asia’s investment industry and to add to our people bench strength. We offer our clients a winning combination of enhanced service capabilities -- our deep regional understanding, local service presence and substantial fund distribution coverage mean that Standard Chartered Bank is uniquely placed to assist our clients to overcome the challenges they now face in growing their businesses in this environment.” Developed for its client base of Asset Managers and Insurance Companies in Asia, Standard Chartered Bank’s Fund Services complement the Bank’s award winning custody and cash services.

Kenmar, a Connecticut-based fund of hedge funds, has opened its first international office in Singapore. Kenmar Asia will be headed by Chris McLeod who was formerly with ABN Amro in Hong Kong and was in charge of alternative investments.

Credit Suisse was awarded two major international industry accolades as "Outstanding Global Private Bank" and "Outstanding Business and Entrepreneurs Private Bank" at the 18th Private Banker International Wealth Management Summit held in Singapore.In addition, Credit Suisse was also selected as a finalist in the award categories of "Outstanding Private Bank - Europe", "Outstanding Global Private Banker" and "Outstanding Young Private Banker". Mr Walter Berchtold, Chief Executive Officer of Private Banking for Credit Suisse commented, "At Credit Suisse, we are extremely honored to receive this recognition of our Private Banking franchise. In the midst of such unprecedented and exceptionally challenging environment for our industry, this is a strong vote of confidence for the success of our growth strategy, the dedication of our employees, our firm commitment to focus on our clients and deliver to them the integrated bank solutions from across all our businesses for their personal and corporate needs. The strong continuous inflow of net new assets of CHF 40 billion we received in the first nine months of this year underscores the strength of our franchise and the trust placed in us by our clients worldwide." "Our Private Banking business has demonstrated strong resilience and achieved good results in these challenging times. Consistent with Credit Suisse's strategy, we will continue to invest in and grow our Private Banking franchise which I am convinced will be even stronger when we come out of this environment. Most importantly, now more than ever, we will continue to stay close to our clients, restore confidence and lend solid support to our employees."Commenting on the awards, John Evans, managing editor of Private Banker International and lead judge for the awards said, "Credit Suisse has had to take hits from the credit crisis, but unlike its rivals in Switzerland and elsewhere, it has escaped the worst of the mauling and is undergoing rapid expansion of its wealth management capabilities. Credit Suisse has been exceptionally well placed to be among the favored homes for client funds as the credit crisis unfolds.""The 'Outstanding Business and Entrepreneur Private Bank' award is for the institution that is able to most professionally harness its capabilities to meet the disparate business, private investment and estate planning needs of its clients. Credit Suisse's One-Bank integration of private and investment banking is steadily gaining momentum, and so this year the bank takes the award. It is reporting steadily more impressive revenues across the group from referrals between business units."The Wealth Management Awards are based on inviting nominations from the worldwide readership of Private Banker International. Form the short list, winning institutions are chosen by PBI's Advisory Board which is made up of independent industry experts. The awards aim to benchmark best practices and best business models in the quickly evolving wealth businesses in Asia and worldwide. The Private Banker International Wealth Management Summit 2008, held in Singapore from November 6 to 7, is organized by the global wealth journal Private Banker International (PBI), part of VRL Knowledge Bank.

Threadneedle, a leading European asset manager, has been ranked top performing fund manager in Hong Kong according to Global Investor Magazine, which uses Morningstar ratings.James Campion, Head of Asia Distribution for Threadneedle, based in Hong Kong, said, “This ranking is testimony to the quality of Threadneedle’s fund managers and the range of products we have to offer investors in this market with an average of 3.6 stars over the 31 Threadneedle funds rated by Morningstar.”He continued, “These are challenging times for investors all over the world and we are determined to continue to develop our product range to meet their needs and aim to deliver good performance in any market condition.”Threadneedle expanded into Asia this year to serve its global clients better. It opened its first regional office in Hong Kong in May 2008, followed by an office in Singapore in October 2008. The Singapore office is led by Sue-Wei Wong, who relocated from Threadneedle’s London head office and is responsible for business development relationship in the region. Threadneedle’s range of 34 equity and fixed income mutual funds and eight hedge funds are authorised as restricted schemes in Singapore. Threadneedle has US$98 billion of assets under management globally, as at 30 September 2008. Threadneedle can only deal with professional or institutional investors in Hong Kong and Singapore respectively in accordance with local legislation.