The Cerulli Report Asset Management in Japan 2015

Transcription

1 The Cerulli Report Asset Management in Japan 2015 Capturing Rising Foreign Interest NEW Interactive Data Supplement Overview & Methodology This joint report between Cerulli Associates and Nomura Research Institute (NRI), in its third iteration, provides an update on the Japanese investor landscape across key client segments retail pension funds, banks, and insurers. In light of the recent public pension reforms and evolving distribution trends, this report assesses opportunities for foreign managers with insights from key decision makers. It highlights subadvisory opportunities, both retail and institutional, for asset managers and puts forth the most optimal strategy for firms wishing to tap into these addressable assets. Data included in this report is from an annual survey of nearly 70 asset managers, representing 80% of the assets under management in Japan. LOOK INSIDE THIS REPORT Benefits - Analyze the market size and identify opportunities - Assess Japanese managers criteria for selecting foreign managers - Examine the outlook for household financial assets - Understand which asset flows are more stable in Japan - Evaluate changes the GPUF has made to its foreign bond manager structure Questions Answered - Besides the much-talked-about Nippon Individual Savings Accounts (NISA), what are the other drivers for households to move from deposits to investment products? - What is the impact on asset managers from public pension reforms and to what extent can the change be expected in other pension sectors? - Who are the top-10 foreign subadvisory managers in Japan? - What are the selection criteria and servicing requirements for subadvisory mandates? - How can managers leverage banks increased allocation to foreign securities? NEW Interactive Data Supplement Experience Cerulli s digital platform and interact with analyses from this report today 197 Pages, 133 Exhibits Subscription Information $17,000 Annual - Hardcopy - Digital copy in color - Unlimited online firm-wide access - Exhibits in Excel - Key findings - Online access to 6 related reports - Analyst support - NEW Interactive Data Supplement Research Included A subscription to this report remains active until the next iteration of this report releases and includes online access to the following related Cerulli research: Six years of Asset Management in Japan To Purchase CALL info@cerulli.com VISIT With this report subscription, we re pleased to include these interactive dashboards: 1. Japanese Mutual Fund Market Overview: Examine the assets under management and net new flows by open-end equity investment trust and conventional investment trust. 2. Japanese Pension Funds Market Overview: Review assets under management and asset allocation by pension fund. 3. Japanese Financial Institutions Overview: Assess the Japanese financial institution landscape by asset class and bank type.

2 New Cerulli interactive Data SupplemeNt Interact with select Cerulli Report analyses today What are Interactive Data Supplements? We are pleased to offer an interactive experience with select data contained in 2015 Cerulli Reports. This Interactive Data Supplement (IDS), allows you to interact with select exhibits in unique ways: NEW Interactive Data Supplement Access consolidated data from multiple report exhibits in a single comparative view Home in on specific data elements Build custom charts that are easily exported for presentations and other materials Apply customizable filters to Cerulli Report analyses including assets under management, net new flows, product type, channel, year, marketplace, and currency $120,000M $100,000M $80,000M EXPLORE FIRM: Select Firm YEAR: Q 2013 PROGRAM TYPE: Customize elements including currency, year, channel, etc. $60,000M $40,000M $20,000M $0M Q Q Q Q Q Q Q Q Q Q 2013 $140,000M $120,000M $100,000M $80,000M $60,000M $40,000M $20,000M 10% 5% 0% -5% (All) Mutual Fund Advisory Separate Accounts Rep as Portfolio Manager PROGRAM NAME: (All) Manager Select Model Wealth Portfolio Optimum Market Portfolio Personal Wealth Portfolio SAM (non-securities) SAM (securities) UVEST - CAA UVEST - NATCO UVEST - Vista Mgr Direct UVEST - Vista Wrap Rep as Portfolio Manager Separate Accounts Mutual Fund Advisory Assets Growth Rate View granular data Export exhibits the way you want them to look in Excel, PDF, or as an image $0M Q Q Q Q Q Q Q Q Q Q 2013 Source: Cerulli Associates Remember my changes How to Access IDS This new service is complimentary and is accessible via Cerulli Client Login. Simply access your firm s online Cerulli research with your unique login credentials and you will find the View Interactive Data Supplement link to this platform in My Reports. VIEW INTERACTIVE CHART You can also jump to the related IDS chart in the report by clicking on the View Interactive Chart button throughout the PDF. To obtain online access: Visit or contact our account management team: info@cerulli.com

3 Mutual Funds Chapter 6 exhibit 6.19a Discretionary Managed Account Assets Under Management, 1H H 2015 ( trillions) Source: Nomura Research Institute, based on Fundmark data H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H AUM in investment trusts exclusively for DMAs (e.g., fund wraps, SMAs) have grown rapidly since the second half of FY2012, reaching 4.4 trillion by end-september. the Cerulli Report Asset Management in Japan C A

4 Expanded table of Contents table of CoNteNtS - Expanded Key Questions Answered Will investment trusts see major inflows from households? Which asset flows are more stable in Japan, retail or institutional? What changes has the GPIF made to its foreign bond manager structure? What should a new entrant consider when it looks for business opportunities in Japan?...17 Chapter 1: the Japanese Investor landscape...19 Exhibit Asset Management Business in Japan, March Exhibit Assets Under Management by Asset Management Companies in Japan, March 2003 March Exhibit Outlook for Household Financial Assets (5-Year Forecast)...22 Exhibit Breakdown of Household Financial Assets by Investment Experience and Purpose of Funds...24 Exhibit Loan/Deposit Rate and Security/Deposit Ratios by Bank Type, March 2003 July Exhibit Impact of Bank of Japan in Japanese Government Bond Market Through Chapter 2: Asset Management Companies in Japan...30 Exhibit Japanese Asset Management Industry Assets Under Management by Investor Type, March Exhibit Decomposition of Annual Changes in Asset Management Company Assets Under Management, FY2003 FY Exhibit Largest Public Mutual Fund and Pension Asset Managers, March Exhibit 2.04a. Asset Management Company Aggregate Revenues, FY2003 FY Exhibit 2.04b. Domestic Asset Management Company Profit Margins, FY2006 FY Exhibit Asset Management Company Cost Structures, FY Exhibit Use of Business Process Outsourcing in Japan...40 Chapter 3: the Subadvisory Attraction...41 Exhibit Japanese Investment Trust Asset Under Management Outsourced to External Managers, 2000 September Exhibit Outsourced Share of Investment Trust Assets Under Management by Fund Category, September Exhibit Basic Subadvisory Arrangements...44 Exhibit Roles of Fund Sponsors and Subadvisors...45 Exhibit Breakdown of Investment Trust Assets Under Management Between Japanese and Foreign Asset Management Companies, June Exhibit Subadvisors Ranked by Subadvised Assets Under Management, June Exhibit Investment Trust Companies Ranked by Assets Under Management Outsourced to Subadvisors, June Exhibit Process of Building Relationship with Subadvisor for an Investment Trust Distributed Through the Broker/Dealer Channel...51 Exhibit Japanese Asset Managers Subadvisor Search Process for an Investment Trust Distributed Through the Bank Channel...52 the Cerulli Report Asset Management in Japan C A

5 table of Contents Expanded Exhibit Advisory Product Development/Launch Flow...53 Exhibit Asset Classes Rated by Asset Management Companies in Terms of Interest in New Advisory Products, Exhibit Key Subadvisor Selection Criteria, Exhibit Types of Subadvisor Relationship...58 Chapter 4: Public Pension Funds...59 Exhibit Roadmap of GPIF and Related Parties Actions...60 Exhibit Adoption of New Policy Asset Mix by GPIF...61 Exhibit Replacement of Japanese Equity Managers in March Exhibit GPIF s Manager Structure in Foreign F/I Portfolio...67 Exhibit GPIF s Desired Governance Structure...69 Exhibit Outlook for Pension Fund Business in Five Years, Chapter 5: Foreign Managers...74 Exhibit Assets Under Management and Revenues by Major Client Segment, August Exhibit Revenue Pools and Marketing Approaches by Major Client Segment, August Exhibit Investment Process Characteristics from the Standpoint of Sales Model and Branding...77 Exhibit Largest Foreign Asset Management Companies by Assets Under Management in Japan...82 Chapter 6: Mutual Funds...83 Exhibit Overview of Investment Trusts in Japan, September Exhibit 6.02a. Open-End Equity Investment Trust Assets Under Management, 1997 September Exhibit 6.02b. Open-End Equity Investment Trust Net Flows, 1997 September Exhibit Open-End Equity Investment Trust Assets Under Management by Asset Management Companies, September Exhibit Open-End Equity Investment Trust Assets Under Management by Net Flows, September Exhibit 6.05a. Breakdown of Open-End Equity Investment Trust Assets Under Management by Mode of Intermediation, September 2006 September Exhibit 6.05b. Breakdown of Open-End Equity Investment Trust Assets Under Management by Mode of Intermediation, September Exhibit 6.06a. Conventional Investment Trust Assets Under Management, 1997 September Exhibit 6.06b. Conventional Investment Trust Net Flows, 1997-September Exhibit 6.07a. Breakdown of Conventional Investment Trust Assets Under Management by Fund Category, 1997 September Exhibit 6.07b. Percentage Breakdown of Conventional Investment Trust Assets Under Management by Fund Category, 1997 September Exhibit Conventional Investment Trust Assets Under Management and Net Flows by Asset Management Companies, September Exhibit 6.09a. Monthly Dividend Fund Assets Under Management, 1997 September Exhibit 6.09b. Monthly Dividend Fund Net Flows, 1997 September Exhibit 6.10a. Breakdown of Monthly Dividend Fund Assets Under Management by Fund Category, 1997 September Exhibit 6.10b. Percentage Breakdown of Monthly Dividend Fund Assets Under Management by Fund Category, 1997 September C A 8 the Cerulli Report Asset Management in Japan 2015

6 Expanded table of Contents Exhibit 6.11a. Monthly Dividend Fund Distribution Yield, 1997 September Exhibit 6.11b. Monthly Dividend Fund Performance Indices, 1997 September Exhibit Monthly Dividend Fund Assets Under Management and Net Flows by Asset Management Companies, September Exhibit 6.13a. Other Conventional Investment Trust Assets Under Management, 1997 September Exhibit 6.13b. Other Conventional Investment Trust Net Flows, 1997 September Exhibit 6.14a. Breakdown of Other Conventional Investment Trust Assets Under Management by Fund Category, 1997 September Exhibit 6.14b. Percentage Breakdown of Other Conventional Investment Trust Assets Under Management by Fund Category, 1997 September Exhibit Other Conventional Investment Trust Assets Under Management and Net Flows by Asset Management Companies, September Exhibit 6.16a. Exchange-Traded Fund Assets Under Management, 1H H Exhibit 6.16b. Exchange-Traded Fund Net Flows, 1H H Exhibit 6.17a. Exchange-Traded Fund Ownership by Investor Category, July 2012 and January Exhibit 6.17b. Exchange-Traded Fund Availability by Asset Class Exhibit Exchange-Traded Fund Assets Under Management and Net Flows by Asset Management Companies, September Exhibit 6.19a. Discretionary Managed Account Assets Under Management, 1H H Exhibit 6.19b. Discretionary Managed Account Net Flows, 1H H Exhibit 6.20a. Breakdown of Discretionary Managed Account Assets Under Management by Fund Category, 2004 September Exhibit 6.20b. Percentage Breakdown of Discretionary Managed Account Assets Under Management by Fund Category, 2004 September Exhibit Discretionary Managed Account Assets Under Management and Net Flows by Asset Management Companies, September Exhibit 6.22a. Defined Contribution Investment Trust Assets Under Management, 1H H Exhibit 6.22b. Defined Contribution Investment Trust Net Flows, 1H H Exhibit 6.23a. Breakdown of Defined Contribution Investment Trust Assets Under Management by Fund Category, 2004 September Exhibit 6.23b. Percentage Breakdown of Defined Contribution Investment Trust Assets Under Management by Fund Category, 2004 September Exhibit Defined Contribution Investment Trust Assets Under Management and Net Flows by Asset Management Companies, September Exhibit Subadvised Investment Trust Assets Under Management, 2001 September Exhibit Share of Asset Under Management in Funds that Outsource Management (Use Subadvisors), September Exhibit Subadvisor Utilization by Investment Trust Management Companies, September Exhibit 6.28a. Breakdown of Equity Investment Trust (Excluding ETF) Assets Under Management by Sales Channel, 1H H Exhibit 6.28b. Breakdown of Equity Investment Trust (Excluding ETF) Net Flows by Sales Channel, 1H H Exhibit Equity Investment Trusts (Excluding ETF) Annualized Redemption Rates by Sales Channel, 1H H Exhibit Percentage Breakdown of Equity Investment Trusts (Excluding ETF) Assets Under Management by Fund Category, September the Cerulli Report Asset Management in Japan C A

7 table of Contents Expanded Exhibit 6.31a. Customers Open-End Equity Investment Trust Holdings by Broker, March Exhibit 6.31b. Customers Open-End Equity Investment Trust Holdings by Bank, March Exhibit Wrap Account/Separately Managed Account Assets Under Management by Retail Discretionary Managed Account Provider, June Exhibit Percentage Breakdown of Discretionary Managed Account Assets Under Management by Fund Category, September Exhibit Overview of Nippon Individual Savings Accounts Exhibit Cumulative Number of Nippon Individual Savings Accounts Opened by Age Group, March 2014 June Exhibit Cumulative Funds Invested through Nippon Individual Savings Accounts, March 2014 June Exhibit Overview of Junior Nippon Individual Savings Accounts Exhibit Overview of Defined Contribution Pension Plans Exhibit 6.39a. Defined Contribution Pension Plan Participants, March 2005 June Exhibit 6.39b. Breakdown of Defined Contribution Pension Plan Assets Under Management by Asset Class, March 2005 March Exhibit Major Proposed Amendments to Defined Contribution Pension Plan Act, April Chapter 7: Pension Funds Exhibit Overview of Japanese Pension Systems and Investment Bodies Exhibit Major Indices Used as Policy Portfolio/Investment Product Benchmarks Exhibit Information Ratio Distributions for Traditional Asset Classes, 3- or 5-Year Term Through to August Exhibit Japanese Defined Benefit Pension Assets Under Management, March 2008 March Exhibit Japanese Corporate Defined Benefit Pension Asset Allocation by Plan Type, End of Fiscal Exhibit Japanese Corporate Defined Benefit Pension Assets Active/Passive Allocations, March 2010 March Exhibit Japanese Corporate Defined Benefit Pension Asset Allocations for Alternative Investments, March 2010 March Exhibit Japanese Corporate Defined Benefit Pension Managers Assets Under Management, March Exhibit Japanese Corporate Defined Benefit Pension Product Distribution Structure Exhibit Japanese Corporate Defined Benefit Pension Lead Manager Ranking by Plan Type, March Exhibit Japanese Corporate Defined Benefit Pension Consultant Use, March Exhibit Japanese Corporate Defined Benefit Pension Major Consulting Firms, March Exhibit Japanese Corporate Defined Benefit Pension Major Subadvised/Subadvising Company Relationships by Asset Class, March Exhibit Pension Fund Association Assets Under Management and Asset Allocation, March 2009 March Exhibit PFA Assets Under Management Breakdown by Management Type and Mandate Winners Through Subadvisory Scheme Exhibit Japanese Public Defined Benefit Pension Manager Assets Under Management, March Exhibit Government Pension Investment Fund Assets Under Management and Asset Allocation, March 2009 March Exhibit Government Pension Investment Fund Mandate Winners and Fee Levels for Foreign Asset Classes, FY Exhibit Other Major Public Pension Plans Assets Under Management, March Exhibit Selected Major Public Pension Plan Asset Allocations, March 2009 March Exhibit Japanese Defined Contribution Pension Assets Under Management, March 2009 March Exhibit Japanese Defined Contribution Pension Asset Allocation, March 2011 March C A 10 the Cerulli Report Asset Management in Japan 2015

8 Expanded table of Contents Chapter 8: Financial Institutions Exhibit Balance of Investment Securities (All Banks), March 2005 March Exhibit Balance of Investment Securities by Asset Class (All Banks), March 2005 March Exhibit Composition of Investment Securities by Asset Class (All Banks, Excluding Overseas Branches), March 2005 March Exhibit Balance of Other Securities (All Banks, Excluding Overseas Branches), March 2005 March Exhibit Balance of Investment Securities by Bank Type (Including Overseas Branches), March 2010 March Exhibit Composition of Investment Securities by Bank Type (Including Overseas Branches), March 2010 March Exhibit Balance of Other Securities by Bank Type (Excluding Overseas Branches), March 2005 March Exhibit Composition of Other Securities by Bank Type (Excluding Overseas Branches), March 2005 March Exhibit Investment Securities to Deposit Ratio by Bank Type, March 2005 March Exhibit Loan to Deposit Ratio by Bank Type, March 2005 March Exhibit Yields on Loans and Investment Securities (All Banks), March 2005 March Exhibit Yield on Loans by Bank Type, March 2005 March Exhibit Yield on Investment Securities by Bank Type, March 2005 March Exhibit Loans Outstanding (All Banks), March 2005 March the Cerulli Report Asset Management in Japan C A

9 Company Index CoMPANY INDeX AllianceBernstein...66 Ashmore Investment Management...66 Bank of Japan...12, 26, 27, 83, 84, 111, 112, 179, 182, 183, 187, 188, 192, 194, 195 BlackRock...66, 156, 169 Brandywine Global Investment Management...66 Capital International...65 Cohen & Steers...46 Colchester Global Investors...66 Daiwa Asset Management...89, 90, 97, 109, 119, 127 Daiwa SB Investments...65, 104, 156 Daiwa Securities...24, 78, 132, 135 DBS Asset Management...39 DIAM Eastspring Investments...65 Fidelity Investments Japan...90, 109 Fidelity Worldwide Investment...65 Fischer Francis Trees & Watts...66 Franklin Advisers...66 Goldman Sachs Asset Management...66 Harris Associates...65 Insight Investment Management...66 Invesco Asset Management...65 J.P. Morgan Asset Management...65 Janus Capital Management...66 Japan Post Bank...25, 27, 28, 29, 32, 75, 80, 81 Japan Post Insurance...25 LaSalle...46 Lehman Brothers...84 Loomis Sayles...66 MacKay Shields...66 Manulife Asset Management...66 MFS Investment Management Mitsubishi UFJ Kokusai Asset Management...97, 124, 127 Mizuho Asset Management...65 Morgan Stanley Investment Management...66 C A 196 the Cerulli Report Asset Management in Japan 2015

10 Nikkei Group Nikko Asset Management...38, 49, 90, 127 Nissay Asset Management Nomura Asset Management...49, 65, 89, 90, 97, 104, 114, 119, 124, 127, 139, 156 Nomura Corporate Research and Asset Management...66 Nomura Funds Research and Technologies (NFR&T) Nomura Group Nomura Research Institute (NRI)...12, 23, 24, 46, 54, 55, 85 Nomura Securities...24, 78, 132, 135, 160 Northern Trust Okasan Asset Management Pictet PIMCO...46, 66 Prudential Investment Management...66 Pyramis Global Advisors...66 Rating and Investment...12, 160 Russell Investments...65, 166 Schroder Investment Management...65, 66 Shinko Asset Management...90 SMBC Nikko Securities State Street Global Advisors Standish Mellon Asset Management...66 Sumitomo Mitsui Asset Management...109, 156, 162 Sumitomo Mitsui Banking Corporation Sumitomo Mitsui Trust Asset Management...90, 119, 124 Sumitomo Mitsui Trust Bank...133, 135 Taiyo Pacific Partners...65 Tokio Marine Asset Management Towers Watson...160, 166 Tyndall Investment...39 UBS Global Asset Management...66 Vontobel Wells Capital Company Index the Cerulli Report Asset Management in Japan C A