Private Banks

HSBC Private Banking announces record Alternative Investments Fundraising

HSBC Private Banking has reportedly raised over USD1.3 billion of private client funding for alternative investments in Asia from April 2019 to April 2020.

The funds were raised across a broad range of product solutions including hedge funds, private equity, private credit and USD350 million in a private real estate investment trust (REIT) strategy, according to a press release by the bank.

Edward Moon, Regional Head of Alternatives, Asia Pacific, HSBC Private Banking, said: “Global markets across every major asset class experienced significant volatility in the first quarter of 2020 and investors are keen to enhance the resilience of their portfolios while maintaining consistent return generation. During times of market stress, alternative investments provide a number of key portfolio benefits, including diversification and downside risk protection, and allows investors to access a broader universe of investment strategies that are less correlated with markets. So far in 2020, we have already raised over USD850 million in alternative investments on behalf of our valued clients in Asia.”

“In addition to diversification benefits to clients’ portfolios, investments in private markets may also offer a higher return potential when compared to the public markets, especially in the current low yield environment.  In recent years, the overall number of publicly listed companies in developed markets has been declining, or conversely, more companies are choosing to stay private and for longer periods than ever before. In addition, the nature of private equity’s investment horizon allows managers to deploy capital across a multi-year period which may help to lower volatility. Against this backdrop, clients with the appropriate risk profiles and who have a long-term investment horizon are increasingly looking to investment opportunities within private markets (both equity and debt) as a way to diversify their portfolios,” Moon continued.

In the last 12 months, HSBC has offered a diverse mix of alternative solutions including: a secondary private equity strategy, a global real estate private credit fund, a European distressed debt/special situations vehicle, a private REIT and a core diversified private equity solution. HSBC has also seen considerable inflows in the hedge fund space across a broad range of strategies, including equity long-short strategy, multi-strategy and market neutral strategy, says the firm.

Continuing to deliver best-in-class products and services

HSBC Private Banking says that it places particular focus on helping clients navigate their way through a challenging investment environment, yet at the same time aims to help make a positive change in the world. HSBC Private Banking has recently introduced its first private equity impact fund to their Asian client base, further enhancing its suite of alternatives offerings to meet the needs of our clients, in particular the ultra-high-net-worth individuals (UHNWIs) and the next generation of investors. The fund invests in private companies that are driving positive environmental and social impact and responsive growth, alongside offering strong business performance and returns.

HSBC maintains long-established strategic partnerships with many of the world’s leading alternative asset managers, including HSBC Alternative Investments Limited (HAIL), a unit of HSBC Global Asset management (AMG), to offer high quality alternative investment solutions. Partnering with HAIL, HSBC Private Banking has been offering alternative investments for over 30 years, including hedge funds, private markets and real estate in Europe, UK, North America, Asia and MENA. With a team of 54 investment professionals in Alternatives, HSBC Global Asset Management manages, advises on or has oversight of USD43.3 billion of assets, as of 31 March 2020, across hedge funds, private equity, infrastructure equity, private debt, infrastructure debt and direct real estate.