Newsletter May 2015

Secretariat News

ASIF interim Executive Committee meeting held in Tokyo

asif-interim-exec-committee-meeting

ASIF interim Executive Committee meeting was held on Saturday 25 April at Gakushi Kaikan in Tokyo in conjunction with the 6th SAAJ International Seminar. All of ASIF’s Executive Committee members, Dr. Yasuhiro Maehara, Chairman, Mr. Craig Lindsay, Deputy Chairman, Mr. Russell Thomas, and Dr. Lin Yixiang were present and held lively discussion on the future course of action of the Federation.

Among other things, the dates of the ASIF meetings were decided to be held 29-30 October 2015 in Singapore. Details of the meeting would be announced to all ASIF members as soon as available.

Members’ Regional News: Finsia Australia

Finsia says Australia on cusp off free-trade financial services bonanza

Finsia, Australasia’s peak financial services body, says the industry is under-prepared for the opportunities set to arise from free trade agreements (FTAs) with Japan, China and South Korea.

Recent research shows Asian markets are projected to grow at between 2.5 and 7 per cent over coming decades with the Asian financial system on-track to be bigger than the US and Europe combined by 2030. Meantime, China’s GDP per capita is set to almost double between now and 2020.

Finsia Chief Executive Officer Russell Thomas said Australia has more work to do in order to benefit from the scope of the opportunities in exporting financial services and talent to Japan, China, South Korea and neighbouring countries.

“The signing of the FTAs isn’t an end point, but the start of what could be a once-in-a-generation opportunity to build a world class financial services export industry.

“We really need to focus on how the Australian financial services industry is preparing its people to work offshore and in exporting financial services to meet increasing demand from Australia’s regional neighbours,” Mr Russell said.

Asia’s financial institutions are expected to be increasingly important in global finance and will be home to many of the world’s largest financial centres. For example, Shanghai is seen as a potential rival to New York as a financial centre.

Rapid urbanisation and consumer-centric growth will continue in China and India, while the 10 ASEAN nations are collectively home to over 600 million upwardly mobile people.

“We talk about ‘Asia’ quite broadly when we should be thinking about each of the 17 countries in that area and how best we can take our best people and services to them.

“Now is the time to build the services that will help members benefit from the rising demand for financial services and products in Asia,” Mr Thomas said.

Finsia is a member of a consortium of professional membership organisations in Asia with a focus on how to facilitate the free movement of people in the financial services industry.

The Finsia is working on initiatives for qualifications developed in Australia to be recognised in other markets.

Mr Thomas said financial services professionals need to be willing to learn about the local culture and integrate with Asian people socially.

“It’s all too often that we have Australian financial services professionals arriving in key markets such as Japan and China culturally unprepared, without any languages skills, and ignorant of local business practices.

“The people question in the export of financial services is absolutely important to this industry. Immigration, free movement of people, benchmarking our education, our workplace capabilities are all critical,” Mr Russell said.

Finsia’s advocacy for the export of financial services to Asia comes as the organisation seeks to amend its corporate governance standards and structures of its Board.

Key changes include increasing the Board’s effectiveness through a reduction in Directors to a minimum of 7, and maximum of 9, along with a greater emphasis on diversity of skills and experience.

Governance Matters — an independent expert — were engaged to assist the Board to review its governance structures and practices. These key reforms will be considered at the organisation’s Annual General Meeting on 28 May.

Finsia supports Australian Fintech hub

The Financial Services Institute of Australasia (Finsia) fully supports the establishment of a fintech hub in Sydney.

Launched by NSW Premier the Hon Mike Baird MP today, the hub will see NSW Government, and leading associations and corporates in finance and technology, join forces to build on Australia’s natural strengths as a fintech centre and promote innovation.

“Stone and Chalk, Australia’s fintech hub, is a fantastic initiative and a major step towards realising the recommendations of the Financial System Inquiry and Committee for Sydney/KPMG’s report on fintech, explained Finsia CEO Russell Thomas. “This public–private collaboration is necessary to cement Australia’s place as a regional fintech hub.”

The Chair for the fintech hub is Craig Dunn, a member of the Financial System Inquiry panel and former CEO of AMP. Mr Thomas congratulated Mr Dunn on his appointment.

Commenting on Finsia’s role as a foundation partner Mr Thomas said, “For Finsia, fintech presents an immense opportunity for our up and coming industry leaders. Financial services is experiencing major change, and technological innovation in product development and service delivery is a vital part of this.”

“Start-ups that utilise the Stone and Chalk hub will be able to access low cost services and industry networks — connecting fintech entrepreneurs to leading insights and mentors is a key role that Finsia will play in this initiative.”

“We’re proud to support Stone and Chalk and because it will enhance Australia’s reputation in the Asia-Pacific region as a fintech centre. This will have many positive effects, including innovation and cross-sector collaboration as well as attracting international talent and capital to Australia.” Start ups wanting to know more should visit stoneandchalk.com.au

Finsia leading the way on adviser education standards

Finsia, Australasia’s peak financial services body, said the industry has an opportunity to set a global benchmark for the professional standards of financial advisers.

Finsia’s submission to Treasury’s latest consultation calls for the introduction of a national industry examination to help provide better outcomes for consumers.

Finsia Chief Executive Officer Russell Thomas said the adviser test would help boost consumer confidence and play a critical role in delivering sound financial advice.

“The community understands the national exam as an independent test of competence. An examination provides assurance that everyone in the industry, no matter where that adviser has previously studied, is up to a professional standard,” Mr Thomas says.

Finsia says all advisers, regardless of their age or previous qualifications, should be required to pass the national test following an initial transition period.

“We have been particularly vocal in our support for the genuine desire among financial institutions to address the serious concerns that have been raised about the quality of financial advice and products”, says Mr Thomas.

Finsia also says financial advice plays a critical role in boosting retirement incomes and ensuring that Australian retirees have enough to live off their super. The ageing of the population is expected to place a further strain on the country’s fiscal position.

Mr Thomas said the impact of digitisation on the financial services industry was also a critical area in the realm of financial advice and services. The organisation is calling for any new regulatory measures to be forward looking and consider the role new technology will play in the delivery of advice to consumers.

“The convergence of financial services and technology, or ‘fintech’, presents an opportunity for up and coming industry leaders. We are likely to see increasing levels of disruption in the delivery of financial services to the client.

“With this in mind, we need to be cautious of only solving for yesterday’s problem and taking a retrospective approach to regulation. Instead, the industry needs to be thinking about new digital platforms that will be offering tailored, lower cost financial advice. It really should be about access to quality financial advice, rather than specific business models that are currently in place,” Mr Thomas said.

Finsia’s advocacy on industry education standards comes as the organisation seeks to amend its corporate governance standards and structures of its Board.

Key changes include increasing the Board’s effectiveness through a reduction in Directors to a minimum of 7, and maximum of 9, along with a greater emphasis on diversity of skills and experience.

Governance Matters — an independent expert — were engaged to assist the Board to review its governance structures and practices. These key reforms will be considered at the organisation’s Annual General Meeting on 28 May.

Members’ Regional News: HKSI Hong Kong

2015 Study Mission to Tokyo: HKSI Institute Meets Abe’s Advisers on 3-Arrow Strategies

The Hong Kong Securities and Investment Institute (HKSI Institute) led a high-level Study Mission to Tokyo recently to obtain the latest update on the outlook of “Abenomics” and to explore potential collaborations with key Japan stakeholders in the financial services industry. The delegation met with senior officials and representatives from market institutions and companies, including:

  • Japan Economic Revitalization Bureau, Cabinet Secretariat
  • Ministry of Finance
  • Financial Services Agency
  • Bank of Japan
  • Government Pension Investment Fund
  • Japan Securities Dealers Association
  • The Securities Analysts Association of Japan
  • Tokyo Stock Exchange
  • Nomura Securities
  • Mizuho Financial Group
  • Toyo Securities
  • AlixPartners

“Our annual visit to a key financial market in the region has been a highlight in the HKSI Institute’s calendar. It offers exceptional access to direct, high-level dialogue with key movers of the selected country,” said Mr Craig Lindsay, Chairman of the HKSI Institute. “This year, our Tokyo Study Mission had the privilege of meeting with the very team who advises Japan’s Prime Minister Mr Shinzo Abe on his three-arrow strategies, and the Government Pension Investment Fund for an “insider’s” view of their investment strategies,” he added. ”It is refreshing to see a significant positive difference in sentiment and energy level of market participants and the overall economy.”

Mr Kenju Ogyu, Managing Director of Toyo Securities Asia Ltd. and Organising Chair of the Study Mission to Tokyo, said, “As a Japanese in the industry for over 27 years, I would not be able to access the organisations and senior officers if not for the association with the HKSI Institute.”

This sentiment was echoed by Mr Choi Hyungkyu, Chief Executive Officer of QUAD Capital Management Limited, who joined the membership of the HKSI Institute because of the attractiveness of the programme. “I have been investing in Japan as a fund manager for a long time, and the trip helped me affirm our investment strategies and gave me new insights,” he said.

For the third consecutive year, two awardees from the HKSI Institute Young Talent Programme were able to join the study mission through the generous sponsorship of I-Access Group Ltd. In line with the Japan-theme, the candidates submitted an analytical essay on “The Impact of Japanese Yen Depreciation on Its Neighbouring Regions” to compete for the coveted spots to Tokyo.

Mr Louis Mak, Chief Executive Officer of I-Access Group Ltd who personally reviewed the essays to select the scholars said, “This is a good outreach programme to nurture young talents for the industry, and provide them the opportunity to learn from and interact with seasoned professionals.”

Ms Sky Luo, a Tokyo awardee remarked, “It was an eye-opening and rewarding experience for me, having met officials from government entities and major financial institutions, and learnt the latest financial development.” The trip was made even more memorable for Ms Luo, who is a management trainee at the Hong Kong Exchanges and Clearing Limited as the group witnessed the historical moment and joy with senior representatives at the Tokyo Stock Exchange on the day of their visit, where Japan’s Nikkei closed above 20,000 points for first time in 15 years.

HKSI Institute Corporate Members of Japanese origin – Nomura International (Hong Kong) Ltd. and Toyo Securities Asia Ltd., hosted the lunches during the Study Mission to welcome the delegation to their home-town, a positive testimony to the rich international composition and meaningful engagement of our corporate membership. At the trip, the HKSI Institute was also able to meet with long time member Mr Patrice Conxicoeur, Chief Executive Officer of HSBC Global Asset Management (Japan) K.K., upon his relocation to Japan this year.

“Further playing the ambassadorial role in the region, we connected delegates with The Securities Analysts Association of Japan (SAAJ), our fellow Asian Securities and Investment Federation (ASIF) founding member. SAAJ hosted a dinner reception for our delegates who were also invited to their 6th international conference after the 2-day trip,” said Mrs Edith Chan, Chief Executive of the HKSI Institute.

“Providing unique access to industry leaders with thoughtful programmes is our best service to our Members. We are pleased to have achieved this for our delegates to Tokyo,” Mrs Chan added.

Members’ Regional News: Securities Analysts Association of Japan

The 6th SAAJ International Seminar was successfully held in Tokyo

SAAJ seminar

On Friday 24 April, the 6th SAAJ International Seminar was successfully held at Gakushi Kaikan in Tokyo with about 140 attendees. There were attendees from overseas including Australia, Cambodia, China, Chinese Taipei, Hong Kong, and Korea.

The main theme of the seminar was “Asset Management in Asia: Opportunities and Future Development”. The details of the sessions are available here.

Members’ Regional News: SRTC Vietnam

Preparation for the derivatives market launch in Vietnam: SRTC activities

More than 14 years since the first trading sesssion on HSX - the first stock exchange of Vietnam - in 2000, the securities market has made certain contributions to the domestic economy. With a view to make a further step in implementing the Securities Market Development Strategy until 2020, the project of constructing the derivatives market in Vietnam was appoved by the Prime Minister in March 2014. As recently as early May of this year, the Decree No. 42/2015/ND-CP on derivatives market was promulgated, marking an important milestone in the preparation for launching this financial market segment in the country in 2016 as expected.

In addition to the regulatory framework and market infrastructure, education is considered another critical aspect of this preparation process. Therefore, the Securities Research and Training Center (SRTC), whose function is to offering certified capital market professional traning and investor education programs in Vietnam, has put a great effort into designing a totally new curriculum which would be used in its newly introduced derivatives course. The course, which was arranged for the first time in April 2015 when and all participants totaling around 30 people were SSC employees, is expectedly offered to professionals in the market by the end 2015.

Besides, conferences and workshops have been organized by SRTC, in cooperation with organizations both inside and outside the country, to provide the local regulators and market participants knowledge of derivatives and derivatives markets. Among which, the seminar titled ‘Risk management in the derivatives market: Experiences from Japan’ jointly held by SRTC and the Securities Analysts Association of Japan (SAAJ) in Hanoi last October created an opportunity for SSC officials and many representatives of financial institutions to learn practical lessons in operating and promoting the derivatives market from a well-established capital market in the world. SRTC will continue to run more activities focusing on derivatives-related topics in the near future.

Members’ Regional News: IAA Thailand

Exclusive seminar

May 20, 2015 – IAA, Money Channel and Stock Exchange of Thailand were honored to welcome Air Chief Marshal Prajin Juntong, Minister of Transport. He addressed on "Transportation and telecom Infrastructure policy to drive Thai economy" for investors and the capital market's executives, emphasizing the Thai capital market's role as an important source of fund for transportation and telecommunication mega projects of government and private sectors, a powerful engine to further drive Thailand's economic growth.

IAA Annual General Meeting

April 30, 2015 - IAA had arranged Annual General Meeting at SET Building. Mr.Paiboon Nalinthrangkurn, CFA - Chief Executive Officer, TISCO Securities Co., Ltd. was elected to be IAA Chairman. Other directors elected are as follows:

  • Mr.Kiattisak Jenwipakul - Managing Director, SCB Securities Co., Ltd.
  • Dr.Krisada Sektrakul, CFP - Director, Thailand Securities Institute, The Stock Exchange of Thailand
  • Mrs.Porranee Thongyen, CISA - Senior Executive Vice President, Asia Plus Securities Co., Ltd.
  • Mr.Ratchakritpong Ekrangsun – President, Investment Analysts Association
  • Mr.Satit Wannasilpin - Assistant Managing Director, KKTRADE Securities Co., Ltd.
  • Mr.Sombat Narawutthichai - Secretary-General, Government Pension Fund
  • Mr.Sukit Chawalitakul, CFA
  • Mr.Tanavatt Bhanijkasem - Senior Executive Vice President & CIO, SCB Asset Management Co., Ltd.

New IAA President

April 30, 2015 - IAA welcomed Mr.Ratchakritpong (Krit) Ekrangsun who was appointed as IAA’s President & Secretary-General. Mr. Ekrangsun obtained his MBA in Finance from Western International University, USA and BA on Computer Information Systems from Weber State University, USA. Prior to joining IAA, he was the Head of Business Development, Chief of Staff – Life Corporate Strategies, Generali Life Assurance (Thailand). His extensive background has been in asset management and fixed income sales & trading. Other key positions held by Mr. Ekrangsun include:

  • Head of Fixed Income Investment Unit, Head of Research Analysts Unit: Office of Investment Bureau, Social Security Office, Ministry of Labor, Thailand.
  • Head of Fixed Income Sales & Trading: KGI Securities (Thailand) Plc.
  • Senior Fund Manager, UOB Asset Management

Education program specially designed for analysts

IAA and Thailand Securities Institute (TSI) – the Stock Exchange of Thailand (SET) arranged 2-joint projects to develop analysts as follows:

1. "Presentation Skill for Pro-active Analysts Workshop"
April 3 and 8, 2015 - IAA arranged a project to develop senior analysts on "Presentation Skill for Pro-active Analysts Workshop". This project aimed to strengthen the ability and communication skills of analysts.

2. “Valuation for Insurance Business”
April 20, 2015 - IAA provided the seminar on “Valuation for Insurance Business” to review and enhance analysts’ knowledge on assessing the value of the insurance business. Our guest speaker is the expert in this business, Mr.Tommy Pichet, FSA, FIA, FSAT, FRM, MBA, MScFE (Distinction), B.Eng (Hons) who has also been active in the actuarial profession.

IAA Awards for Listed Companies 2014

IAA-awards-listed

February 26, 2015 - IAA presented “IAA Awards for Listed Companies 2014” to honor the Chief Executive Officers, Chief Financial Officers, Investor Relations Directors of Listed Companies for their top management capabilities along with their commitment to transparency in information disclosure and high standard of ethics in equitable treatment of their stakeholders. The awards are categorized into 8 sectors: Agro & Food Industry, Banking, Property & Construction, Resources, Services, Technology, Industrials and Market for Alternative Investment.

IAA Awards for Analysts 2014

March 26, 2015 - IAA presented the IAA 2014 Best Analyst Awards to recognize the most outstanding analysts and research teams at the SET Building. The aim of the event is to encourage analysts to produce top quality research papers, to recognize analysts’ efforts, to create public awareness on the significance and contribution of securities analysts and research reports to the capital market, and to promote analyst accountability and ethical standards.