UOB Asset Management (Thailand) plans to move up to the top five of the local asset management industry after its merger with ING Funds (Thailand) completes by the second quarter of this year.
Vana: Top-five status comes more quickly
The Singapore-based United Overseas Bank Ltd announced in November last year to purchase all shares of ING Funds (Thailand), the Thai unit of the Dutch company, in a deal worth 10 million euros.
UOBAM (Thailand) projected its assets under management would reach 100 billion baht this year from 79.5 billion baht last year.
After the merger, the assets will double to 200 billion baht.
"This will bring us to the top five as targeted more quickly," said Vana Bulbon, CEO of UOBAM (Thailand).
With such an asset size, UOBAM has positioned itself as a regional firm starting this year, thanks to the extended regional network.
ING Funds manages mutual funds, provident funds, private funds and property funds with 2.9 billion euros in assets under management, according to the Singapore Stock Exchange.
The ING Group has recently shifted its focus to the core banking business in line with its long-term strategic plan.
The decision does not affect ING's strategic partnership with TMB Bank, according to the ING statement.
Mr Vana said the consolidation of both companies is being considered by the regulators of Thailand, Singapore and the Netherlands. The process should be concluded by the end of next quarter.
As for assets, the consolidation should be completed by the second half of this year.
Mr Vana said UOBAM in Thailand has a free hand in marketing compared to other bank-owned asset management companies, which are more prone to internal competition among peers under the same groups.
"Normally, when a bank raises its deposit interest rate, investors will shift from asset management firms to banks to take advantage of it. Besides, products of bank-owned asset management firms are mostly plain vanilla, which make it even harder for them to avoid internal competition," said Mr Vana.
UOBAM plans to expand private funds or its high-net-worth client base, the area that has great potential, especially complicated products which will offer a high return on investment.
"This group are keen on complex investment products as simple offers such low-yield funds do not appeal to it. The high-net-worth group mostly has large portfolios too," said Mr Vana.
The products include alternative investment, global equity, commodity, property and private equity funds.
He added private equity funds are keen on long-term investment in real sectors such as energy, industry and food.
The company has planned to launch three new property funds to invest in hotels and serviced apartments in the third quarter, with returns expected at around 7% per year.
UOBAM will also continue to launch equity funds as it anticipated the Stock Exchange of Thailand index will rise by another 100 points from now.