HSBC keeps rating despite Morningstar concerns
HSBC’soverall three star rating fromMorningstarhas survived a review by the research house which had scaled down the majority of the fund manager’s qualitive ratings.
High turnover of the senior management and weak profitability of the local operations were of greatest concern to Morningstar in its review. Other concerns were that attribution analysis of investment performance was limited at the fund manager, while planned back office systems were needed, which Morningstar says places HSBC behind its competitors.
Eleven out of 15 areas of assessment were downgraded by Morningstar. HSBC’s corporate strength rating took a dive because of weak profitability of local asset management, which Morningstar links with staff instability. However, Morningstar acknowledges the continued support for global parent HSBC Holdings which it describes as having a strong global prescence.
Meanwhile, ratings of HSBC’s administration and distribution, investment management and asset allocation capabilities were also downgraded, as were the sector ratings on Australian cash, Australian fixed interest, International Fixed interest, Australian listed property, International equities as well as product ratings on unit trusts and superannuation funds.
Two sector strength ratings improved: Australian direct property and Australian equities.
Of HSBC’s suite of funds on offer, 62 per cent of them (53 funds in total) now have ratings of three, four or five stars, while at the end of January this year, 73 per cent of its funds were rated three stars or better. In this time there was an increase of three star funds, but this occurred at the expense of four star funds, according to Morningstar, which fell from 40 per cent at January 31 this year to seven per cent a month later.
Recommended for you
Net cash flow on AMP’s platforms saw a substantial jump in the last quarter to $740 million, while its new digital advice offering boosted flows to superannuation and investment.
Insignia Financial has provided an update on the status of its private equity bidders as an initial six-week due diligence period comes to an end.
A judge has detailed how individuals lent as much as $1.1 million each to former financial adviser Anthony Del Vecchio, only learning when they contacted his employer that nothing had ever been invested.
Having rejected the possibility of an IPO, Mason Stevens’ CEO details why the wealth platform went down the PE route and how it intends to accelerate its growth ambitions in financial advice.
