US-based Neuberger Berman sets foot in China, makes senior hires

View of Shanghai City at night

US-based investment manager Neuberger Berman is expanding into China with a Shanghai arm which will be a wholly foreign-owned enterprise (WFOE).

The firm has also made some senior Shanghai-based appointments for the China subsidiary.

The investment management arm will allow Neuberger Berman to operate an onshore investment management business in mainland China, subject to the registration with the Asset Management Association of China (AMAC), it said in an announcement on Tuesday.

“Once the registration is complete, Neuberger Berman will be able to manage and distribute private funds to a broader client franchise including private banks, independent wealth management platforms and local institutions,” the firm added.

Neuberger Berman, a private, independent, employee-owned investment management firm manages equities, fixed income, private equity and hedge fund portfolios for institutions and advisors worldwide. With offices in 19 countries, it manages $255 billion in client assets as of December 31, 2016.

Industry veteran Patrick Liu has been appointed as the Head of China and General Manager of Neuberger Berman Investment Management (Shanghai) Ltd. Liu was previously CEO of HFT Investment Management, a joint venture of BNP and Haitong Securities, one of China’s largest brokerage firms. He has also held senior roles at Invesco Greatwall Fund Management and Deutsche Asset Management.

“As we further expand our investment and client coverage presence in the Asia Pacific region, China represents a significant growth opportunity for Neuberger Berman,” said Nick Hoar, Head of Asia Pacific, Neuberger Berman.

In addition to Liu’s appointment, Neuberger Berman has also added senior personnel in its client coverage team. William Hui, who previously led the development of both the retail and institutional business at Deutsche Asset Management, joined recently as Head of China Institutional Business. William will work alongside Marco Tang, Head of China Retail Business, in spearheading the firm’s business development in China.

Earlier this year Neuberger Berman Group closed a $2.5 billion fund NB Secondary Opportunities Fund IV LP to buy secondhand stakes in private equity funds.The total corpus of the fund was raised in just nine months and succeeded the third fund NB Secondary Opportunities Fund III LP which had raised $2 billion in November 2013. The current fund has a global mandate and will pursue secondary opportunities in private equity funds, direct investments, co-investments and structured private equity opportunities.

Meanwhile, the recent entry for the firm into China follows many other asset managers from the West who have taken advantage of the recent wholly foreign-owned enterprise (WFOE) rule in China. After the rule was brought about it has opened the market for global fund managers that have set foot in China as they can now manage domestic assets on behalf of domestic clients. Among some of the firms that took benefit of the rule are Fidelity which has a Shanghai arm and also one of the first asset managers to register with the AMAC.

Among others is also UBS Asset Management which has a WFOE in the Shanghai Free Trade Zone where it can launch private funds investing in assets for investors that include institutions and rich Chinese individuals and a WFOE in Beijing through which it operates as a private fund manager for real estate, private equity and infrastructure investment.

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