Aviva Investors, the asset management arm of British insurer Aviva (AV.L), plans to expand in Asia-Pacific by hiring bond and equity fund managers in Singapore and setting up a sales offices in Japan. 

Aviva Investors intends to set up a regional asset management firm in Singapore and will hire 25-30 people to build up its equities and fixed income investment capabilities, Asia Pacific CEO Craig Bingham told reporters in Singapore. 

 

Aviva Investors plans to set up offices in Saudi Arabia and Japan to distribute its investment products, added Bingham, whose area of responsibility includes the Middle East. 

 

“Asia is still a substantial greenfield for us,” said Bingham. He said he was currently in the process of hiring a CEO for the Singapore-based Asia Pacific office, who would in turn recruit fund managers, analysts, marketing and support staff. 

 

Asset management firms have seen a turnaround in fortunes over the past 12 months in line with a recovery in global markets, with some hedge funds also looking to expand into Asian financial centres Singapore and Hong Kong. 

 

Aviva Investors currently has about US$420 billion ($586 billion) in assets under management, the bulk of it from parent company Aviva and other insurance affiliates, Bingham said. 

 

Only about US$20 billion of the funds are invested in Asia, of which about half is managed out of Australia and the rest from 

 

Bingham said there was strong interest among existing clients to invest a larger portion of their funds in Asia, and predicted the Singapore operation will manage about $3 billion three years from now. 

 

Aviva Investors was set up in September 2008 through the combination of several asset management businesses owned by Aviva. It has a relatively small presence in Asia outside of Australia, and the Singapore unit currently handles only real estate investments. 

 

Bingham, who is based in Melbourne, said the new hires will more than double staff at its Singapore operations to 45-50 people by the end of 2011. 

 

The Singapore unit will oversee Aviva Investors’ operations in Asia except for Australia, which will operate separately, and China, where the firm has signed an agreement with broker Central China Securities to set up a joint venture asset management company. 

 

The China venture has yet to receive regulatory approval, he added. 

 

Asked if Aviva Investors would consider acquisitions, Bingham said it was a possibility, although growth in the region will largely be organic, as the cost of buying existing asset management firms was high and there was no guarantee of keeping staff once the deal was sealed. 

 

“I’ve seen lots of companies pay high multiples and end up not getting what they paid for... The number of success stories is really limited.”