The Lion-OCBC Capital Asia Fund I is designed for high net worth individuals and institutional investors, including insurance companies, regional banks and sovereign wealth funds.
It took nine months to secure investor subscription after the fund was launched in late November 2014. It has subsequently been upsized by almost 40% to S$550m ($393m, £254m, €348m) due to strong demand from investors.
Ready pool of SMEs
Singapore-headquartered OCBC Bank has a large client base in the fund’s four core markets, giving it access to a ready pool of SMEs to invest in. This marks the first time OCBC Bank has created a private equity fund through its private equity investment unit, the mezzanine capital unit (MCU), which invests in SMEs.
“We introduced this fund to meet growing interest in alternative assets from our market partners and high net worth customers in Bank of Singapore,” said Daniel Kwan, head of MCU at OCBC Bank
“The fund will open doors for Lion Global to reach out to investors who have shown increasing interest in alternative strategies"
The fund’s core markets are covered by 22 MCU investment professionals who all have local expertise. Lion Global will complement MCU’s investment staff with a team of 40 investment professionals who all have a knowledge of Asian markets.
The fund will hone in on SMEs in the markets’ agriculture, commodities and consumer industries, which has been identified as areas with high potential for growth over the long term.
Gerard Lee, chief executive of Lion Global Investors, said: “In recent years alternative investments have found a growing audience among investors seeking alpha solutions in an uncertain global economic environment.
“The fund will open doors for Lion Global to reach out to investors who have shown increasing interest in alternative strategies.”
Among the Fund’s investors were insurance companies, regional banks, sovereign wealth funds and high net worth individuals, including customers of OCBC Bank’s private banking subsidiary, Bank of Singapore.
OCBC Bank said its home market of Singapore has seen an increasing trend of companies expanding overseas. It said its “widespread reach” in the region could potentially allow the fund to tap into both companies’ growth plans.