GAM 'in advanced talks' with HK financial institution for China growth, Singapore to be Asia hub

GAM said today (27 March) it is actively pursuing two significant growth opportunities in Asia, both in Hong Kong and Singapore, and also flagged imminent plans for a new sales branch in Paris, France. 

In its strategic progress report as part of its 2023 results GAM said it was in advanced discussions to establish an alliance with a Hong Kong financial institution to grow GAM’s business in Greater China.

"This partnership aims to leverage multi-asset production, wealth management, and product distribution, in Hong Kong and mainland China, while maintaining service to existing clients", GAM said.

The other significant growth growth opportunities GAM highlighted in Asia was that "Singapore is set to become a growth centre for GAM, alongside Hong Kong, Japan, and Australia, with investment and distribution staff moving to Singapore.

"Pending regulatory approval for an expanded licensing scope, GAM intends to establish Singapore as a strategic hub for Asia. This strategic move capitalises on Singapore's strong growth as a leading Asian wealth management and private banking destination, aligning perfectly with GAM's product and distribution expertise."

In Japan, a new head of distribution has been appointed with additional new sales hires in core markets, particularly in Europe and Australia, aimed to  "better serve local clients and capture growth opportunities".

GAM also said it was extending its market reach with a plan to establish a new sales branch in Paris.

IFRS net loss after tax was CHF 82.1m, compared to CHF 290.0m in 2022. Underlying loss before tax of CHF 49.5m, compared to CHF 42.5m in 2022.

Investment Management assets under management (AuM) were CHF 19.3bn, compared to CHF 23.2bn as of 31 December 2022.

GAM did however cite strong investment performance: 78% of Investment Management AuM outperformed three-year benchmark, and 81% outperformed five-year benchmark as of 31 December 2023.

Elmar Zumbuehl, CEO GAM Investments said: “After a very challenging 2023, we have made good strategic progress. The fully underwritten rights issue will strengthen the balance sheet of the firm and provides enhanced long-term stability for the business and support for the implementation of our growth strategy.

"It also demonstrates our anchor shareholder’s unwavering long-term commitment to GAM. In 2024, we will continue to focus on our clients, innovation and maintaining our strong investment performance. I would like to thank our clients for their continued support and recognise the ongoing commitment of our anchor shareholder and my GAM colleagues.”

As for its core active equity, fixed income and multi asset strategies, GAM cited good progress in its partnership with Investcorp-Tages, "resulting in positive momentum and increased flows into our Global Rates strategy".

"We are moving two global equity funds currently managed by Bruellan SA to GAM, with CHF 84 million of AuM as at end of February 2024, to be managed by GAM’s Global Equities team", GAM said.

A number of new partnerships in the alternative space were also under development, including expanding on GAM’s alternatives and partnering with Avenue Capital on its Sports strategy.

"We are also building out GAM’s hedge fund platform. Our late-stage private equity strategy, which received 2023 Emerging Fund of the Year in Australia, is being launched in Europe."

The sale of its FMS business for third-party funds to Carne Group was successfully completed on 31 January 2024.

In addition, GAM has reached agreement with 1741 Group, a leading Swiss provider, to transfer management company services for the GAM funds in Switzerland.

"Good progress has also been made in the negotiations with high quality, global firms on transferring management company services for the GAM funds in Luxembourg, Ireland and the UK, paving the way to a simplified, scalable and investment management focused operating model.

"We will complete the transition to a single operating platform, which includes having all investment management activities on our new cloud-based Simcorp platform, by the end of 2024. This will ensure greater efficiency across our global operations."