Big demand for OCBC private equity fund

OCBC Bank and its asset management subsidiary Lion Global Investors said their first private equity fund with outside investors closed successfully on strong demand.

The fund ended almost 40 per cent higher at $550 million from its initial target of $400 million.

The Lion-OCBC Capital Asia Fund I, LP will invest in small and medium-sized firms in Singapore, Malaysia, Indonesia and China.

Among the investors are insurance companies, regional banks, sovereign wealth funds and high-net-worth individuals, including customers of OCBC Bank's private banking subsidiary, Bank of Singapore.

It took nine months to secure investor subscription after the fund was launched in late November last year. A fund of this size would typically take more than a year to close, the companies said.

"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 Mr Daniel Kwan, head of OCBC Bank's private equity investment unit Mezzanine Capital Unit (MCU).

"Investors in the fund were attracted by the superior returns that MCU has consistently delivered for OCBC of more than 20 per cent internal rate of return in the past six years as its private equity unit, as well as by the fund's unique positioning as a bank-sponsored investment fund," he added.

Mr Gerard Lee, chief executive officer of Lion Global Investors, noted that alternative investments have found a growing audience among those seeking alpha solutions in an uncertain global economic environment.

Mr Lee said that the fund will open doors for Lion Global to reach out to investors who have shown increasing interest in alternative strategies.

A version of this article appeared in the print edition of The Straits Times on August 28, 2015, with the headline 'Big demand for OCBC private equity fund'. Print Edition | Subscribe