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Goldman Sachs Plans to Expand Asia Prime Services Team This Year

Bei Hu
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Goldman Sachs Plans to Expand Asia Prime Services Team This Year

(Bloomberg) -- Goldman Sachs Group Inc. plans to add more staff for its Asia prime services team this year, after expanding the unit by 15 percent in 2018 to an all-time high.

The move is a bright point for an industry reeling from its worst year since 2008. Asia-focused hedge funds last year lost an average 8.9 percent -- more than double the global decline -- according to preliminary estimates from Eurekahedge Pte. Still, amid the carnage funds continued to open and about one in three made money.

“We see a continued increase in activity by global and local hedge funds,” Padideh Raphael, who took over as Asia-Pacific head of Goldman’s prime services business in August, said in a recent interview. “We are optimistic about our client franchise and plan to continue hiring selectively this year.”

AsiaHedge’s annual industry survey released in May suggested the number of funds using Goldman Sachs as a prime broker rose by 32 in the previous 12 months. While declining to give a precise number, Raphael said the number of new mandates won in calendar 2018 was more than double that.

Goldman Sachs saw a 20 percent increase in investor queries about its Asia fund clients in the second half of 2018 from a year earlier, Raphael said. In 2017, Asia hedge funds returned an average 17 percent, the best return since 2009, according to Eurekahedge.

“Investors remain interested in Asia and are looking to increase allocations to the region,” she said. “Despite challenging global market conditions since the second half of 2018, they continue to see opportunities to generate alpha in this region.”

About one-third of the mandates Goldman Sachs won in the region 2018 were from new funds, Raphael said. The rest came from existing firms adding or switching prime brokers.

(Update with team size at all time high in first paragraph.)

To contact the reporter on this story: Bei Hu in Hong Kong at bhu5@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Peter Vercoe

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