World’s largest online financial market will be in China: CEO

March 28, 2014 Leave a comment

World’s largest online financial market will be in China: CEO
Staff Reporter
2014-03-19
China could make as much of a contribution to the world as Apple’s iPhone, as the country is likely to become the world’s largest market for online financial funds in the next five years, said Gregory Gibb, CEO of the Shanghai Lujiazui International Financial Asset Exchange, also known as Lufax.

The CEO predicted a bright future for online financial funds in China as the country provides an ideal place for their development. Around 81% of China’s wealthy population were born between 1960 and 1989, and their demands for financial management technologies are strong. In addition, their embrace of the internet, mobile network and new technologies is strong.
As of December last year, the number of internet users in China reached 618 million, while mobile network users reached 500 million, according to the China Internet Network Information Center.
Compared to China, demands for online financial funds in the United States and Europe are relatively low, as existing traditional financial services are well-established and in high quality, Gibb said. Americans and Europeans have less urgent needs for online financial services since existing services are diverse and cover most of the population, he added.
The Chinese financial industry, on the other hand, has been unable to fully explore its potential client groups such as small and micro businesses and private-owned firms due to structural issues. There are very few financial instruments in the country available for stable and fixed-income investments, according to Gibb, adding that small and medium investors do not have any effective investment channels.
Meanwhile, Chinese traditional financial institutions are struggling against high operating and trading costs, difficulties in allocating their assets and debts and managing their liquidity.
Online financial funds has provided solutions to these problems and add new layers to China’s financial sectors. They provide a fast financing channel for small and micro businesses as well as private companies. Their transparent and fast transactions also significantly reduce operating and trading costs while enhancing efficiencies. Moreover, systematic liquidity risks reduce as the responsibility of providing liquidities is transferred from financial institutions to individuals, the CEO said.

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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