SCBAM’s strong investment capabilities recognized
SCB Asset Management (SCBAM), Thailand’s largest asset manager, has maintained its ‘Excellent(tha)’ National Investment Management Quality Rating (IMQR) from Fitch Ratings, according to a press release issued on Monday.
The rating reflects SCBAM’s strong investment capabilities and operational framework.
Fitch identified several factors that contributed to SCBAM’s high rating, including a strong investment process, an experienced investment team, and effective risk management.
Citing a well-structured and disciplined approach for its various funds, Fitch stated that SCBAM conducts in-depth fundamental research, has a formal investment decision process and an active investment committee.
To make informed investment decisions, the firm uses both quantitative tools and qualitative factors, such as ESG practices.
Additionally, SCBAM is constantly improving its use of machine learning in its domestic and foreign equity funds.
Fitch also noted that its portfolio managers are qualified and have relevant expertise in their respective asset classes. Staff turnover has been decreasing, and a strong succession plan reduces key person risk.
Furthermore, Fitch noted that SCBAM’s risk management framework is closely aligned with that of its parent company, the Siam Commercial Bank. This ensures strong oversight and centralised auditing functions.
“The firm maintains a dedicated risk management and compliance team independent of investment functions, and plans are underway to establish sub-committees for enhanced control and monitoring across different asset classes,” Fitch’s statement read.
SCBAM holds the top spot in Thailand’s asset management industry, with a 20.6% market share and 1.8 trillion baht in assets under management (AUM) as of 2023.
The firm excels in mutual funds and private funds, and it also has a strong position in provident funds. Client service continues to improve with comprehensive reporting capabilities and a variety of communication channels.
Moreover, Fitch stated that SCBAM has consistently delivered strong risk-adjusted performance compared to its peers. Fixed income funds, the largest segment of SCBAM’s AUM, have demonstrated consistent performance. Equity and asset allocation funds have also performed well in comparison to industry benchmarks.
However, Fitch warned that the rating could be downgraded if any of the key rating drivers experience significant negative changes. These include: investment process, resources, risk management, company performance, client service, and investment performance.
Additionally, any downgrade of SCB Bank’s credit rating or a change in ownership that weakens SCB’s support for SCBAM could have an impact on the IMQR rating.
Overall, Fitch’s affirmation of the ‘Excellent(tha)’ rating strengthens SCB Asset Management’s position as Thailand’s leading asset manager, providing a strong investment platform and consistent performance to its clients.
