The Funds Partnership Asia’s Salary Guide 2020 : Fund Administration

19 Mar 2020

Director’s Note

So much has changed in 12 months since we last wrote our 2019 salary guide! We are now on the brink of a global pandemic and witnessing the largest work from home experiment in the world! In June 2019, in addition to the trade war uncertainties, we saw the Hong Kong spring of protestors who took to the streets creating a new dimension of political uncertainty in Hong Kong which has affected the confidence of investors.

Although 2019 started off very positively much like 2018, the above-mentioned uncertainties have hindered investment activity for our clients particularly in the second half of the year. The mutual tariffs imposed due to the US-China trade war affected the real economy, killed demand and affected real suppliers in China. This created more bad debts in China affecting the performance of fixed income portfolio managers especially those focused on the Hong Kong and Chinese market. As a result, there were increased redundancies for this asset class. However, interestingly, this gave rise to private debt fund managers who emerged promising to restructure private company debts and in some cases, we saw traditional bond houses build their private debt teams. Hence, the demand for professionals with restructuring and debt investment skills was higher than in previous years.

With the above in mind, we are not at all surprised that 70% of all our hiring was in the family office, private markets space. Despite all the uncertainties, Asia can still boast over 15 trillion of AUM and we still expect the funds industry to grow in Asia and meet the PWC estimation of hitting 29 trillion of AUM by 2025 resulting in good job growth across Asia. In Singapore, we anticipate many new jobs will be created due to the newly developed Variable Capital Company (VCC) regime introduced by MAS which looks set to create at least 10,000 new jobs by 2030. We are anticipating more jobs to relocate to Singapore and remain optimistic.

Market Overview

The Fund Administration industry has grown and evolved significantly over the years and this will only continue into 2021 due to investors’ demands for real-time, transparent data and the ability to manage more complex instruments and/ or multi-asset products.  Moreover, with new names on the block, we observe existing administrators are more inclined to partner or build technology as a means to help increase the scale of operations and efficiently allocate costs. Lastly, with the market saturation, investors expect fund administrators to provide more value than the traditional middle and back office solutions. 

A common solution concluded by the majority of our clients is the belief in investing in new systems and technologies to cope with tomorrow’s challenges in this fast-paced industry. With the rise in unconventional investments, the manual processes that once served a few funds will now only hinder and affect investors, employees and the firm’s competitive edge. With that, the majority of our clients shared an inclination towards an integrated solutions model and the provision of end-to-end fund administration services in an effort to become trusted business partners with fund managers. However with the increased competition, fees are being compressed and costs are a major consideration for the industry which has resulted in a majority of our clients continuing to outsource their operations to India, Philippines, Malaysia, Mauritius or China. This meant that there were less new roles being created in Singapore and Hong Kong.

To meet investors’ demands, the demand for Private Equity fund accounting professionals is still at an all-time high across China, Singapore and Hong Kong respectively. Singapore-based fund administrators are gaining much more traction in the market as compared to their Hong Kong counterparts; with the Variable Capital Companies (VCC) framework initiative by Singapore and the chaos from the protest since Feb 2019, we observed many investors shifting their investments to safer pastures. The demand for Hedge Fund talent is beginning to dwindle slightly as the market is already pretty saturated, however, we still observe some people movements across Singapore, China and Hong Kong respectively. We have also observed that there has been an increase in demand for talent with private debt and Real Estate knowledge in China and Singapore too. There is also a marginal increase in demand for corporate secretaries with investment funds technical knowledge; however, due to the limited pool of such candidates, the majority of our clients are training new blood to meet business demands.

Salary Guide

Read the pdf version of the Funds Partnership Asia’s Salary Guide for Fund Administration here:

Funds Partnerships Asia Salary Guide 2020: Fund Administration

 

To find out more about the Fund Administration industry, please contact:

Lyn Thum

Consultant

lyn@fundspartnership.com