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  • SuperReturn Asia 2022

    SuperReturn Asia 2022

    SuperReturn Asia 2022

    Wonderful to attend SuperReturn Asia in Singapore this year and to be part of the celebration for the Singapore Office opening of Gulf Capital, as well as the SVCA’s 30th anniversary Gala & Award Dinner. 

    Always a pleasure to attend the biggest networking events to catch up with our peers from all around the world! The appetites are changing and evolving in the current economical environment, along with the alterations in the market landscape for long-term value creation.

    No doubt that we are all “Navigating Asia’s Changing Market Landscapes” and “Bridging West and East by finding the Fastest Growth Investment Corridor”, but the primary question remains to be where the next chosen market would be? Still China, SEA, or Indo-Asia? 

  • SVB Capital

    SVB Capital

    Finex and SVB Capital partnership

    We are thrilled to be working with SVB Capital. As the investment platform of SVB Financial Group which is dedicated to serving the innovation economy and entrepreneurs, SVB Capital offers powerful investing expertise and oversights tailored to the VC industry. The deeply interconnected investment platform provides LPs with access to the most innovative companies and fund managers. We are excited about this partnership and looking forward to great success!

  • Belt and Road Summit 2022

    Belt and Road Summit 2022

    Belt and Road Summit 2022

    There were fresh insights from last week’s Belt and Road Summit 2022 in Hong Kong! Plus, there were lots to explore under the Belt and Road initiative, which drives multilateral collaborations, such as the GBA and the RCEP. It was great to see our friends discussing frequent cross-border trades and potential investments within the region. Additionally, the Prime Minister of New Zealand, John Key, pointed out that we are facing some supply-chain challenges, which impacted global inflation.

    We believe it is now more critical than ever to re-fuel a strong economic recovery from the pandemic and create more opportunities in the Asia-Pacific, further from the globe.

  • Andra Capital Singapore Roadshow

    Andra Capital Singapore  Roadshow

    Andra Capital Singapore Roadshow

    Finex team had a wonderful three-day roadshow with Andra Capital, where we discussed with institutions and family offices the recent trends of private tech markets as well as their uniqueness in late stage Pre-IPO.

    Always amazed by the city’s beautiful skyline, more to come!

  • Partnership between Growtheum Capital Partner and Finex!

    Partnership between Growtheum Capital Partner and Finex!

    Partnership between Growtheum Capital partners and Finex!

    We are thrilled to be working with Growtheum Capital Partners! Founded by the former leadership of GIC’s Direct Investment Group, Southeast Asia, Growtheum Capital Partners is a private equity firm targeting investments primarily in Southeast Asia. Growtheum aims for enduring partnership with founders and management to jointly generate sustainable value for all stakeholders. We are excited about this partnership and looking forward to great success!

  • AVCJ Singapore Conference 2022

    AVCJ Singapore Conference 2022

    AVCJ Singapore Conference 2022

    It was a great pleasure to attend the AVCJ Singapore Conference 2022. Given the global headwinds and the redirection of capital, we highly appreciated the opportunity to learn from our fellow colleagues in the industry about the trends and stimulation in the PE and VC investment allocations, specifically in the SEA region. 

    Always grateful to hear the fund managers’ inspirational insights on their unique strategies and interact with investors to learn their acumen in all asset classes. 

  • ESG Investing in SEA:  Is Green Turning Brown?

    ESG Investing in SEA:  Is Green Turning Brown?

    ESG Investing in SEA:  Is Green Turning Brown?

    Over recent times, many investors, both large institutions and small family offices, here in the SEA markets have focused not only generating high returns, but also using the ubiquitous ESG criteria for their investment guidelines.  If 2020 and 2021 can be considered banner years for sustainability investing, then 2022 is shaping up to be a year of the backlash against the ESG trend.  Has ESG’s growing “green” movement suddenly wilted to a brown hue of late?

    Why may one ask since ESG seems to have been adopted globally for properly-accepted, responsible investing in modern times?  A recent Moody’s report (May 2022) forecasts that green, social, sustainability and sustainability-linked (GSSS) bond issuance will be flat in 2022.  This can be largely attributed to the recent “green-washing” scandals and market headwinds of high inflation and interest rate hikes that has put ESG investing in the backburner of priorities of late.

    Furthermore, to add more damper to the ESG movement, the US Securities and Exchange Commission (SEC) fined a BNY Mellon unit US $1.5 million ($2 million) for misstatements and omissions about its environment, social and governance considerations this past May also.  These types of ESG standards manipulations will only weaken the fortitude of well-intentioned investors, especially among smaller family offices in Singapore, Hong Kong, and Taipei, who are already nervous about the increasingly volatile markets.

    “There’s a lot of pressure on investment managers to demonstrate the value that they’re getting out of their stewardship work,” said Peter Reali, managing director of responsible investment and engagement at Nuveen LLC, which oversees about $1.3 trillion. And when it comes to wider industry efforts to cut portfolio emissions, ESG investment professionals “definitely hear the complaints and concerns,” he said.

    Many investors around the globe are demanding more evidence that ESG asset managers can truly deliver on their returns, with a growing chorus, including the likes of Elon Musk, that complain the industry is not on the right track.

    Time will only tell if the ESG movement is truly here for long term as originally touted, but history has also proven that competing priorities of the greenback versus the green movement in ESG can not easily be determined among investors, especially within the ultimate verdicts from institutional investors and family offices in SEA.

    [1] https://www.bloomberg.com/news/articles/2022-05-31/esg-fund-clients-demand-proof-strategy-works-amid-backlash

    [2] https://www.theedgesingapore.com/news/environmental-social-and-governance/esg-investing-losing-steam-or-teething-problems

  • Private Credit in a Rising Rate Environment

    Private Credit in a Rising Rate Environment

    Private Credit in a Rising Rate Environment

    Amid the higher than expectation 9.1% year-on-year inflation announced in the US on 13 July 2022, market is expecting even more aggressive measures taken by the Federal Reserve in the US. In this rising rate environment, the floating rate featured in private credit strategies could protect investors by offering an interest rate-linked yield.

    As an asset class, private credit is an umbrella that include asset ranges from corporate debt, distressed lending, mezzanine loan, special situation to real-estate lending. Alternative funds that invest in these assets allows investors to hedge their risk exposed in traditional fixed income and equity investments.

    Private credit strategy is not only an effective hedge against interest rate risk in the US. As year-on-year inflation rate hits a record-high 8.6% in Europe in June, the ECB is also raising rate by 50bps to tame inflation after maintaining a negative deposit rate since 2014. The Bank of England is also considering raising rate by 50bps in August after five consecutive hikes since mid-December 2021. Private credit investments in Europe could also provide a hedge for portfolios with exposure in the region under such market condition.

    Apart from a floating rate hedge, private credit can also act as a mean of capital preservation. According to Pitchbook, in Q1 2022, when the market started to speculate and react to the rate hikes which resulted in a -4.6% QoQ return in the S&P 500, private debt continued to deliver a positive and reasonable 2.89% horizon IRR.

    Investing in a private credit fund where the manager has an expertise in deal sourcing and selection allows investors to generate returns through the streams of repayments specified in the loan terms. The returns are therefore to a very small extent correlated to the public market which makes it an attractive strategy to diversify investors’ portfolio.

    [1] https://pws.blackstone.com/apac/education-insights/article/private-credit-investing-in-rising-rate-environments/

     

    [2] https://www.privatedebtinvestor.com/interest-rates-will-the-rise-burst-the-private-credit-bubble/

     

    [3]https://www.institutionalinvestor.com/article/b1xzvkg9dnwr7g/Private-Credit-Boomed-Amid-Low-Yields-And-Now-It-s-Set-to-Flourish

     

    [4] https://www.reuters.com/markets/europe/ecb-finally-join-rate-hike-club-with-big-move-agenda-2022-07-20/

  • Australia & New Zealand Private Capital Market and M&A Overview

    Australia & New Zealand Private Capital Market and M&A Overview

    Australia & New Zealand Private Capital Market and M&A Overview

    Australian private capital funds have become attractive investment targets for overseas investors in the last decades. Whereas only 18% of overseas funds were invested in the country two decades ago, 49% of these funds were in 2017. This reflects the country’s stable political and governance systems, strong economy, and robust financial markets. Looking at data breakdowns for overseas investors, North American funds have become the country’s largest cohort of foreign investment, at 48% of overall foreign funds in the past five years. Numerous recent investments show that global investors are looking to continue to take advantage of the country’s strong market capabilities.

    Despite Australia’s strict COVID containment policies in the last couple years, its private capital market has continued to grow during the pandemic. It reached a record AUM of AUD$90.0bn in June 2021, which represents an 11% increase from AUD$81.3Bn in December 2020. Breaking down the private capital market into its component spaces, we see echoes of the same story. For example, private equity buyouts reached AUD$20.1bn in 2021, 32% up from its 2020 same. Venture capital reached a high of AUD$7.9bn in 2021, almost double its 2020 total of AUD$3.9Bn. However, the pace itself of aggregate capital growth has slowed in the last year, with private capital funds raising AUD$9.1bn in 2021—10% lower than in the previous year. Interesting to note is also that net IRR for Australia is one of the highest globally. It stood at a 19.6% median in 2021, lower than only Asia, which compares at 37.7%. Historic numbers are also quite high, with the country measuring in at a median net IRR of 17.8% between 2012-2019.

    Globally present inflationary pressures have also touched Australia, with the country reaching 3.5% YoY in Q4 2021, outpacing the Central Bank’s target of 2-3%. However, this number is still tame compared to the 6.7% seen in the United States in the same period. This is driving investors to allocate funds increasingly to alternative investments and active strategies.

    Projected GDP growth in Australia is set to reach 4.2% this year as a result of pent-up consumer demand from COVID as well as higher commodities exports as a result of the Ukraine conflict. However, rising prices and geopolitical uncertainties have put downward pressures on M&A activities in the Australia and New Zealand regions. This has been observed across geographic markets, however, and is not a cause for concern at this time. Based on the number of potential companies up for sale in the months ahead, greatest Australian and New Zealand deal activity should be expected in the TMT sector, followed by Energy, Mining, & Utilities.

    Holistically, the Australian economy has continued to recover at a solid pace. Global concerns, including inflationary pressures and geopolitical uncertainty, remain issues to look out for. However, Australia’s pent-up consumer demand and commodities boom is set to put the country on solid footing for the year ahead.

     [1] https://www.preqin.com/insights/research/reports/australian-private-capital-market-overview-a-preqin-and-australian-investment-council-yearbook-2022

     [2] https://www.datasite.com/us/en/resources/insights/reports/deal-drivers-asia-pacific-q1-2022.html

  • Partnership between Heungkuk Securities and Finex!

    Partnership between Heungkuk Securities and Finex!

    We are excited to announce the historic strategic Korean distribution partnership between Heungkuk Securities and Finex! We are looking forward to creating the largest and most successful local securities platform in Korea!