Ing/uob

[rgs2001uk]

Today I recieved a letter from my ING broker stating they will be selling out to UOB next year.

I have no experince with UOB, and on searching there website for historical data on their LTF funds no data is available, hardly bodes well.

If I am unable to research historical data and performance I may as well transfer to Aberdeen.

Has anyone on here had any dealings with UOB and have any experience with their LTF funds.

First HSBC, now ING, I have to ask myself what do these companies know that I dont?

[fletchsmile]

The only UOB Thailand unit trust I've ever held is UOB Smart Commodities fund. It wasn't too bad when equity funds took a pounding a few years back, and I took a small amount to see how it fared and to diversify my assets a little more in what were highly volatile times.

On a longer term performance basis, it just seemed to lose money. So I cut my losses and sold out, and was down overall about 30% on the small experimental holding. Instead I added to gold mutual funds which have fared well, and given diversification vs equities.

The Smart Commities fund has continued to decline since then and now worth about THB 4 vs an original THB 10 issue price for around 60% loss vs issue price.

In fairness it is a feeder fund rather than using UOB's own fund management "expertsie". That said, if performance was so poor I'd expert them to search for a better alternative for clients. I've seen nothing to suggest I should look at UOB (Thai)'s other funds. I'm quite happy with my Aberdeen and Ing holdings.

Generally in the west retail banks and their fund management arms have run below average performance unit trusts and mutual funds across their full ranges. Although there is occasionally a good performer in their range, the rest usually maintain them below average. (BTW This is one reason I dislike tracker funds, as while they often beat the average active managed fund in a sector, one reason is the duds from retail banks). Retail banks rarely pay fund managers the best salaries so rarely attract the best research analysts and fund managers. People like Lloyds in the UK used to be a good example of consistent poor performance.

As I also hold ING funds I'll continue to monitor the situation. The key will be what happens to the fund managers and research teams in Thailand. With Thailand being relatively new in the fund management industry, unlike say UK or US, there are not necessarily a hold raft of excellent fund management houses to defect to anyway.

For now I would say hold and monitor the situation. No need to sell just yet, but I wouldn't be adding to their funds.

BTW The following site is useful for analysing funds, and comparing

http://tools.morning...anguageId=en-TH

Edited November 30, 2012 by fletchsmile

[fletchsmile]

BTW In terms of what HSBC know that you don't know, that's a tough one without knowing what you know

I've spent a fair amount of time in the Financial Sector in Asia. 3 key factors at play include:

1) Thailand had been an unven playing field for so long with local banks given siginificant protection and support to prevent foreign banks actively competing. eg until the last couple of years HSBC was allowed only one branch. By the time Financial Sector Master Plan (FSMP) 1 and now 2 start coming on the radar it is too late. Foreign banks would start to be alllowed another few branches. This was too little too late, and foreign banks simply couldn't compete for retail volume

2) Events of the last few years have hit the western banks hard. They have had to refocus, cut costs and rebuild their balance sheets. Selling off in countries like Thailand which are restricted and have less potential makes sense to head for growth markets with better potential or core activities elsewhere.

3) Basel II and Basel III create the need for banks to hold more capital for the same level of activity. This means return on capital or return on risk adjusted capital (RAROC) drops. Competition for capital will be more difficult and capital becomes harder to come by. Banks will seek to optimise RAROC by cutting those operations that offer less return for higher risk. This also compounds the first point. Better to compete on a level playing field where rewards better reflect the risks

[rgs2001uk]

FS, will send a PM, there are topics I probably shouldnt mention on here.

BTW thanks for taking the time to reply.

[fletchsmile]

Would be good for us to keep an eye on things and monitor any changes particularly with regards to the fund manager and research.

I liked ING as an alternative to Aberdeen for some funds for diversification and not putting too much of my funds in Thailand with any one fund management house. I liked the idea of a foreign/global parent company with a local presence.

I'd be a bit reluctant to move the funds from ING to Aberdeen because of my own concentration risk, I already have a lot with Aberdeen.

Fortunately the Thai unit trust market is growing. While there may not be as many global players with a local presence as I'd like, the growth of foreign investment funds and feeder funds in recent years will help. eg KTAM and TMB AM have funds branded under their own name which are feeder funds to decent fund managers overseas, eg KT Energy, KT Mining, TMB Global Bond Fund... etc