Credit Agricole fund arm keen to enter India

Mon, Jul 21 06:36 PM

By Jeffrey Hodgson

HONG KONG (Reuters) - The investment management arm of French lender Credit Agricole is actively looking for ways to enter India as part of a broader plan to more than double its Asia-Pacific assets within three years.

Credit Agricole Asset Management (CAAM) is keen to find a joint venture partner with a distribution network in the nation of 1.1 billion, but is also open to an outright acquisition, said Jean-Paul Mazoyer, the firm's head of strategy and development.

"It will depend on the opportunities we will find there. We would prefer to have a JV exactly as we did in Korea or very recently in China," he told Reuters in a phone interview from Paris.

"It's a pragmatic approach to add the knowledge we have about the asset management activity (to a partner's) knowledge of networks and client needs."

CAAM, which had 481.7 billion euros ($764.5 billion) of assets under management at the end of March, spoke with Standard Chartered about the sale of its Indian fund business earlier this year but never reached a deal, he said.

Infrastructure Development Finance Co bought that business for $205 million in cash.

More than 20 new firms are looking to enter India's 34-member Indian fund industry, which had $129 billion in assets under management (AUM) at the end of June. The industry grew nearly 70 percent last year, and the Boston Consulting Group has forecast assets could more than quadruple to $520 billion by 2015.

CAAM is looking to enter higher-growth markets like India as it looks to build on the 15 billion euros in assets it now has under management in the Asia Pacific region.

"Our development plan for the international network of CAAM is to double AUM in the coming three years .... Obviously in Asia we need to more than double," he said.

The fund manager already has offices in Hong Kong, Singapore and Japan, as well as joint ventures in South Korea and mainland China, where it has partnered with Agricultural Bank of China and Aluminum Corp of China Ltd (Chalco).

The French investment manager is launching operations in Malaysia within the next few weeks, Mazoyer said, and will soon upgrade its representative office in Australia into a full-fledged operation.

The executive said the Australia expansion is a priority because of Australia's mandatory retirement savings programme. The scheme has created a savings pool worth more than A$1 trillion and given Australia one of the world's highest levels of funds under management on a per capita basis.

"We must increase our presence there and have the capacity to address the market," he said, adding it would target both retail institutional investors.

Mazoyer said the French firm also liked the growth prospects in Malaysia, where it has already recruited a CEO. He said longer term, the firm could also use the Malaysian operation to help it develop Islamic fund products.

(With additional reporting by Nishant Kumar in Mumbai)

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