Eastspring Raises $417 Million for Fixed Maturity Plan
Asian asset manager Eastspring adds to the ever-growing list of distribution success stories in fixed maturity plans, raising $417 million in the Middle East.
This follows successful fixed maturity plan (FMP) launches in Taiwan and Malaysia which led to exclusive distribution partnerships with Standard Chartered Private Bank in Singapore, Hong Kong, UK and the Middle East. Eastspring’s FMP solution in the Middle East will also include an early termination feature for clients that do not wish to hold assets to maturity.
«Heightened market volatility drives demand for steady income and certainty in investment outcome,» said Xavier Meyer, head of distribution at Eastspring. «FMPs continue to be in strong demand by investors. In the development of this unique FMP, we recognize the need to provide a differentiated offering with wide appeal.»
Expect more FMPs
Meanwhile, central banks have been voicing concerns about the global growth outlook with some, like the Federal Reserve, mulling over a looser policy stance and have recently signalled a potential rate cut. This is expected to fuel more «buy-and-hold» strategies, where investors buy and hold fixed income assets to maturity, either as individual bonds or through a fund like FMPs.
FMPs have gained mainstream prominence a region that is well-renowned for its hunger for yield and popular practice of gaining fixed income exposure mostly by buying and holding bonds to maturity. Despite its relative simplicity, FMPs have been purely high net worth individual phenomenon for the simple reason that private banking clients are able to obtain high levels of leverage to increase the income payout.
