China funds use HK as global springboard

China's major fund managers that have been licensed to operate out of Hong Kong and sell mainland assets to offshore investors are hoping to use the springboard to become global names in asset management.

Among the contenders with this ambition is Harvest Fund Management, one of China's top three asset managers, which last year secured a licence to establish a subsidiary in Hong Kong along with rivals China AMC, China Southern Fund, and E Fund Management.

Its Hong Kong subsidiary, Harvest Global Investments, was given a head start on its rivals, said Michele Bang, HGI managing director and chief executive, because it began life with a pool of assets and investment managers transferred to the operation by Deutsche Asset Management.

Deutsche Asset Management, which owns 30 per cent of HGI's China parent Harvest Fund Magament, transferred mutual fund assets worth more than US$1.5 billion to HGI last year when the Hong Kong operation was formed.

The move ensured that HGI has made the furthest inroads in managing international clients' assets, ranging from European pension funds to Japanese retail asset management funds.

After hiring another dozen employees, HGI now has more than 25 people in its Hong Kong office, ten of whom are in its investment team.

Bang, who was formerly chief executive for Deutsche Asset Management Asia ex-Japan, dismissed talk of any difference between working for a foreign asset manager and a mainland manager. 'I get asked that question a lot,' she said. 'Most of the time I am not even conscious that I am working in a mainland firm. Everyone here has master degrees and is very professional.'