Lending a hand: Publicly listed lender PermataBank director for retail banking Bianto Surodjo (second right) along with head marketing and segmentation Ivy Widjaja (right) gives a document to Ashmore president director Ronni Gandahusada after the signing of a cooperation deal in Jakarta on Tuesday
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London-based investment manager PT Ashmore Asset Management Indonesia will team up with publicly listed lender PermataBank to sell the company's mutual fund products to the bank's customers.
The two firms signed Tuesday a partnership agreement under which PermataBank will distribute Ashmore Dana Progresif Nusantara (ADPN) equity fund, which makes up 60 percent of Ashmore Indonesia's total asset under management (AUM) of Rp 2 trillion (US$175 million).
With the cooperation, within a year until next April Ashmore expects to pocket Rp 500 billion from the sales of the ADPN equity funds.
'We are pretty sure that we can reap Rp 500 billion in AUM from the product as we have a strong position in the urban middle-class category,' PermataBank retail banking director Bianto Surodjo said after the signing ceremony.
Bianto said that PermataBank would particularly market ADPN to its 40,000 upper middle class customers, who were its priority customers.
He also said that his firm would utilize its 315 branches in 60 cities across the archipelago when marketing the product.
Ashmore Indonesia president director Ronni Gandahusada said he was upbeat that his product would be in high demand, particularly by the rising middle class.
'There is a huge untapped potential market for our product. Only 1 percent of the country invests in mutual funds,' he said.
In addition, Ashmore offered a product that consistently outperformed the market, making it able to book Rp 2 trillion in AUM as of April 14, around a year after it launched its mutual fund products, Ronni said.
Ashmore Indonesia director Arief Wana said that ADPN itself jumped up by 28.4 percent from its first inception to the end of March, while the Indonesian Composite Index (IHSG) gained only 5.9 percent.
'We have a very distinct strategy from our competitors. Instead of focusing on big caps, we will focus on small-and-middle caps in the stock market for ADPN,' he said, adding that investment risk was much lower compared to big caps.
Arief said that his firm targeted to double its AUM to Rp 4 trillion by the end of this year, adding that it would capture more retail customers.
'We currently have 150 clients, most of which are corporate,' he said.
Ashmore Indonesia is a new investment manager in the country, established in February 2012.
However, its parent company Ashmore Group has so far booked $75.3 billion in AUM worldwide.
Ashmore Indonesia currently has four mutual fund products distributed through security firm PT Mandiri Sekuritas and PermataBank.
The products comprise two equity funds, namely ADPN Ashmore Dana Ekuitas Nusantara (ADEN), and two fixed income funds Ashmore Dana Obligasi Nusantara (ADON) and Ashmore Dana USD (ADUN).
PermataBank, meanwhile, currently works with eight investment managers to market 35 mutual funds. The firm targets to increase its total lending by 15 percent from Rp 118.8 trillion last year.
Shares in PermataBank, traded on the Indonesia Stock Exchange (IDX) under the code BNLI, closed at Rp 1,360 on Tuesday, 0.36 percent increase from Rp 1,355 in a day earlier.
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