American asset manger Capital Group is looking to build a retirement-focused retail investments business in Asia, the company’s chairman told AsianInvestor.
With Asian markets’ retirement trends now resembling the path trod by the US, Capital has been looking at how to get involved.
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And amid a continuing debate over the direction and growth of China A shares, Capital’s chairman has called for an end to the perception that they are emerging-market equities.
Capital currently, which has analysts and portfolio managers in Tokyo, Hong Kong, Singapore, Beijing, Mumbai and Sydney, is looking at further regional expansion, Capital Group chairman Jim Rothenberg told the publication in an exclusive interview.
"We are looking at broader opportunities because in many countries the retirement and population dynamics have a familiar element," he said.
"In some cases the demographics are worse than America’s. There are retirement services we can bring here. We can work constructively with firms in retail distribution."
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By GlobalData"We now have market and client relationship people here, not just in the US. Over time, I expect that if we do a good job on the investment side, we can make relationships with strategic partners and get business here," Rothenberg added.
Capital built its own retail sales system, called American Funds Distributors, in the US.
On China, Rothenberg said that the country presented an "interesting problem".
Given the rise in A-share values and the opening-up of its capital market over the past year, China will become the world’s second-largest equity market and then challenge the US for the No 1 spot, he said.
"Given that, it’s strange to think China should be classified as an emerging market. I think you should pull China out of the EM bucket. What does that leave you? The US, China, the rest of the developed world, and emerging markets. I think that’s how people will think about asset allocation."
