Singapore sets out criteria for selecting managers for new hedge fund programme
Singapore's central bank has outlined the factors it plans to consider when selecting investment managers for a new hedge fund programme designed to encourage managers to establish or expand their operations in the city state, according to a report by Asia Asset Management.
The Monetary Authority of Singapore (MAS) has unveiled the criteria it will use to select investment managers for a new hedge fund program aimed at encouraging firms to establish or expand their presence in the city-state, according to a report by Asia Asset Management. The assessment will consider various factors, including the managers' dedication to developing their Singapore-based operations and their strategies for nurturing local talent.
MAS will evaluate prospective managers based on their plans to build investment capabilities in Singapore, as well as their approach to developing local talent. Additionally, the regulator will take into account the managers' investment strategies and monitor their progress against the development commitments. The regulator will review the performance of the funds as part of its assessment of the program's objectives.
The initiative seeks to attract hedge fund firms to set up a presence in Singapore or expand their operations in the city-state. Gan Kim Yong, Singapore's deputy prime minister and chairman of MAS, announced the program in a written parliamentary reply on September 8. The regulator is currently consulting with industry participants and has not yet disclosed further details on how the program will operate or which managers may qualify.
The move comes as Singapore's asset management sector continues to grow, with industry assets increasing at a compound annual growth rate of 7.5% over the past five years, reaching nearly SGD7tn ($5.5tn). Hedge funds play an increasingly significant role in the industry, contributing to the depth and diversity of Singapore's financial sector through their investment and trading activities involving other financial intermediaries.
The emphasis on managers' local activities and talent development in the program signifies MAS's intention to assess prospective participants not only on investment performance but also on the extent to which their operations contribute to Singapore's broader asset management ecosystem. Further details about the program are expected to be announced by MAS once its engagement with industry stakeholders has progressed.
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