Japan’s Amova eyes broader South-east Asian footprint through Malaysia’s AHAM

[KUALA LUMPUR] Japan’s Amova Asset Management is looking to expand its footprint in South-east Asia, and has roped in Malaysia’s AHAM Capital to play a leading role as the group pursues opportunities in the region.

Amova Asset Management representative director, president and CEO Stefanie Drews said the Malaysian fund manager’s regional knowledge would support the expansion, as would the Japanese group’s existing Singapore presence and a proposed joint venture in Vietnam.

She told the media at a briefing on Wednesday (Oct 14): “I think AHAM Capital will play a big, big part in the leadership of that corridor … We would like to have a really significant footprint in that space.”

The push into the region forms part of Amova’s growth plan between 2022 and 2032, when the company envisages an equal contribution from organic growth within its existing footprint and acquisitions to fill gaps in its business.

Drews said South-east Asia has been identified as one of six key expansion regions.

The company had at first planned to follow up its foray into Malaysia with launches in the Philippines, Indonesia and Thailand, and to enter Vietnam only later.

But an opportunity for a Vietnamese joint venture cropped up and accelerated that plan: In August, Amova announced an agreement with BIDV Securities, a subsidiary of the state-owned bank BIDV, to set up an asset management firm. Drews said that pending regulatory approval, the joint venture will operate as BSC Amova.

She warned that opportunities to enter other regional markets were limited and that the landscape was complicated, but that South-east Asia remained a major focus.

Amova, which has worked with AHAM Capital in the 15 years, completed its Capital on Jun 30. It now owns nearly 97.7 per cent of AHAM, up from 20 per cent before.

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The transaction involved shares held by CVC Capital Partners, Lembaga Tabung Angkatan Tentera and AHAM management personnel.

Set up in 2001, AHAM Capital is a Malaysian asset and wealth management firm with about RM110 billion (US$27 billion) in assets under administration.

Drew said the familiarity with AHAM from the last 15 years gave Amova confidence in the Malaysian outfit’s culture, processes and approach to clients.

AHAM’s operational independence, client focus and diversified business model were cited as major strengths, she added.

She described Malaysia as a high-potential market, driven by a large deposit base, a young demographic, low investment product penetration, and a supportive regulatory framework.

“These structural advantages offer compelling growth opportunities for asset managers,” noted Drews, adding that Malaysia’s status as a premier global hub for Islamic finance, driven by a proactive, government-led framework.

Malaysia leads the Islamic fund management market, with around 28 per cent of global assets under management; Saudi Arabia’s slice of the pie, in comparison, is around 17 per cent.

Through AHAM Capital, Drews expects the venture to broaden local access to global, US and thematic investment strategies while upgrading capabilities for both retail and institutional clients.

Eyeing high-net-worth individuals

For AHAM, expanding wealth management will sit alongside its corporate and mass-affluent businesses.

Esther Teo, AHAM Capital’s deputy managing director and chief fixed income officer, said the firm manages about RM12 billion (US$2.9 billion) in wealth assets for high-net-worth individuals and sees substantial room for growth.

Its corporate segment accounts for about RM38 billion in assets, serving listed companies and smaller businesses through money market funds and short-term fixed-income products used for treasury management.

Those relationships have helped AHAM develop its wealth business by managing the personal assets of business owners, she said.

The focus on wealthy clients does not mean retreating from the mass market or mass-affluent segment, she added; AHAM continues to distribute products through Malaysian financial institutions, a channel that has recorded strong growth in recent years.

With Amova as its parent, AHAM sees opportunities to strengthen internal investment capabilities and introduce additional strategies for both retail and institutional clients.

Drews said Amova could complement AHAM’s Malaysian and Asian offerings with global, US and thematic products, as well as investment solutions managed from London.