UOB Private Bank has launched Hamilton Lane’s Asia Private Assets fund on its platform on Sept 11.
The fund, which is the first semi-liquid evergreen Asia-focused private equity fund in Asean, will only be available via the bank for a few months.
According to a July 1 release by Hamilton Lane, the fund aims to provide private wealth investors with diversified access to Asia’s private markets. About 40% of the fund will be parked in developed markets such as Japan, South Korea, Singapore and Australia, while another 40% will be invested in emerging Asian countries. The remainder will be in global markets.
The evergreen structure, which has a soft lock-up period of about 18 months, compared to the traditional 10-year lock-up vehicles, was identified as a gap on the bank’s platform about 2.5 years ago, says Wong Meng Keet, head of managed products and alternative investments at UOB Private Bank. In addition, the launch of the product came after “a lot of interest” based on recent client conversations.
With about 86% of businesses in Asia privately held and a “very sizeable” Asian private equity market of about US$3 trillion, Wong notes that the space is an “engine of growth” but is not always reflected in the public markets.
“With Asian private equity, if you take a look at various measures, there's strong evidence that it outperforms the public markets with much less volatility. And that's why it's exciting for us to be able to access this market,” he says in a call with the media.
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“We’re looking at at least 300 basis points or more in terms of outperformance of all fees,” he adds, compared to the MSCI Asia Pacific index, which has returns of sub 5%.
On this, Wong notes that instead of the traditional 60-40 model comprising stocks and bonds, people are now looking at a new model where 60% are in public stocks and bonds and the remaining 40% in private. However, this depends on individual clients’ risk profiles and liquidity limitations.
The Edge Singapore understands that the buy-in would be around $100,000, and most platforms would accept buy-ins in Singapore dollars or US dollars.
