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Daily Dispatches – HK fund managers face uncertain future

Gloomy outlook for Hong Kong fund managers

Gloomy outlook for Hong Kong fund managers

If your are a fund manager in Hong Kong your job security may be looking very uncertain right now, even though most companies rate the island the best place to domicile funds, according to the recent survey by Asian Investors and Clifford Chance.

The survey received responses from 244 fund executives, with one third rating Hong Kong well ahead of other well-known homes of funds, including the Cayman Islands and other offshore locales.

But the South China  Morning Post reports that a number of Hong Kong-based fund managers are winding down operations in the city due to slowing growth on the mainland and improving investment prospects in the US.

SCMP reports that a leading hedge fund recently let its chief financial officer go  and “choppy” market conditions were putting start-up hedge funds under mounting operating pressure.

Another recent high-profile casualty of the decline in sentiment was Chicago-based hedge fund Citadel, which cut six jobs from its Hong Kong office at the start of the month and decided to oversee Asian trading from its offices in the US and Europe.

That followed a decision earlier this year by another hedge fund, SAC Capital, to relocate five staff from its Hong Kong office to London and New York.

One area, however, where Hong Kong fund managers may be secure is in renminbi-denominated and Asia-focused funds, with the Asian Investor poll revealing that 21% were considering RMB funds and 32% were developing products for Asia to take advantage of non-bank alternative financing.

Leadership vacuum at RHB Bank

Malaysia fifth largest bank RHB is facing a recruitment challenge, with three top positions now standing vacant after MD Johari Abdul Muid resigned last week only three months before his contract was due to expire.

Nomura wins Italian case – again

Reuters reports that an Italian appeals court has upheld an earlier ruling that Japanese investment bank Nomura did not made wrongful gains in a derivative deal with Tuscan lender Monte dei Paschi. Nomura stands to get  1.8 billion euros (USD$2.35 billion) of its assets returned after they were seized in April when prosecutors alleged that the Japanese bank had mishandled the so-called “Alexandria” derivative contract.

The Alexandria deal is one of three trades at the heart of a criminal probe at Banca Monte dei Paschi di Siena, which booked losses of 730 million euros in 2012 after saying details of the complex derivatives deals had only just come to light.

The Tuscan bank is also seeking 500 million euros in compensation from Deutsche Bank for a derivative deal similar to the one made with Nomura. Deutsche has also denied any suggestion of wrongdoing.

We’re watching you

Credit Suisse is under the beady eye of the Australian Securities and Investments Commission after it received a second fine for failures related to its automated trading platform.

The Sydney Morning Herald reports that Credit Suisse is on notice after hitting its equities arm with a AUD$95 000 fine for failing to detect a false order placed on its automated trading system. The company has been sanctioned by the stock exchange’s disciplinary tribunal on six other occasions since 2003 – two of which related to automated trades. ”Any future, repeat contraventions in similar or comparable matters will not be viewed favourably,” the commission said.

BNY Mellon hiring in Asia

Asian Investor reports that BNY Mellon is looking to expand its investor base and headcount in Asia after its recent hire of a head of institutional distribution and sales in Singapore.

Finance still first

Banking and financial Services remains the most popular industry with 39.1% of ‘A’ Level and IB diploma graduates, and 28% of first and second year university graduates, according to Singapore’s BrightSparks Scholarship & Career Survey, which polled over 3 000 potential scholarship recipients at local universities.

No women allowed

Unless you are old and therefore unattractive. That is a decision taken by the governor of an Indonesian province who has instructed his top staff to get rid of all their female secretaries after discovering that a number of extra-marital affairs had taken place.

The Straits Times reports that Rusli Habibie, governor of Gorontalo province, said: “I ordered (the staff members) to replace their female secretaries with male assistants or with old women who are no longer attractive.”

Habibie was also quoted as saying that his subordinates treated their PAs better than their own wives. “They bring them presents from official trips like perfumes or branded bags while their poor wives get nothing.”

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