American International Assurance Company (Trustee) (AIA) is to introduce four low-fee MPFs and cut the prices for its three existing funds, effective 23 September 2011.
The four new MPFs – Asian Bond Fund, American Fund, Eurasia Fund and, Hong Kong and China Fund – will carry management fees of up to 0.99% per annum. The new launches will take the firm’s total number of MPF to 25.
The company has also announced a cut in the management fees for its three existing funds – Global Bond Fund, MPF Conservative Fund and World Equity Fund – from 1.75% to 0.99% per year.
Bonnie Tse, chief executive officer, said the new fixed income fund will be managed by J.P Morgan Asset Management, while PineBridge Investments will serve as the asset manager for the three equity MPFs which will mainly invest in ETFs.
AIA, the third largest MPF provider in Hong Kong, currently has a 10% market share with more than 700,000 MPF members.
Tse expects the new launches and fee reductions could help to attract more MPF members thus increasing its market share once member choice comes into practice next year. However, she declined to give a target.
These moves follow AIA’s recent announcement that it was re-naming its existing three MPF schemes.