HSBC and Hang Seng Launch Low-Fee MPF; Fee War to Continue

In February 2011 HSBC and Hang Seng rolled out low-fee MPF plans with fund management fees from 0.79% — and the MPFA chair said the fee war would continue, to members’ benefit.

What’s the selling point?

Low fees plus a diversified fund menu. HSBC’s “Choice” plan and Hang Seng’s equivalent offer nine constituent funds with management fees from 0.79% a year — well below the market average — plus age-based default investment arrangements that auto-adjust risk.

Why the fee war now?

Years of pressure from the MPFA and public opinion. MPF fees have long been attacked for eating returns; the MPFA chair repeatedly blasted the slow pace of cuts, and legislators demanded fee legislation. With big banks leading the cuts, other trustees are forced to follow.

How do members benefit?

Lower fees mean more return in hand. Each percentage point shaved off fees compounds into substantially bigger retirement savings over the long run. When changing jobs or consolidating accounts, members can prioritise low-fee plans. Compare MPF funds’ fee levels at MPF fund comparison.