Not for her the conventional Western perception of a world of high rise Hong Kong apartment living with no outside space but the advantage of overlooking its spectacular harbour.
In her business life too, Fong has also opted to be part of something which is more common in the UK than Hong Kong, as Convoy became the first Hong Kong IFA to get a stock market listing in July 2010, following a period of impressive growth.
High-profile moves
That is how Convoy got the funding to expand in China and also parts of South Asia, the most high-profile move to date being the planned purchase of Singapore based IPP Financial Services which fell through because it was not completed quickly enough.
We are sitting in a big room on the 34th floor of a shiny tower on Hong Kong island where Convoy has its offices as Fong explains the background, that instead of building up a Convoy brand from scratch in Singapore, an acquisition made sense as “money can buy time.”
“The shareholders of IPP indicated they had the intention to sell the company as well and we started the due diligence. We had a deadline to complete the due diligence by end of March this year.”
Terms & conditions
Both of the parties are not yet satisfied with the due diligence, she adds: “It is simply that reason. We had some negotiations on the terms. That is why as a listed company we needed to make an announcement – not to stop it – but that it will not happen yet.”
So are there still ongoing discussions with IPP?
“I think it is still open for us and both of us can open up to looking for potential buyers, but after the deadline we are looking for other purchases as well.”
Most of the due diligence with IPP has finished and she says they are defining the terms that are acceptable to each other. “But that is not quite close to the expectations for both of us yet,” she laughs.
Making an acquisition is a complicated business, which she acknowledges, and points out that in Hong Kong the adviser market has not matured to the same extent as in the UK. For example, there are no networks to support small adviser firms in Hong Kong, which she says partly lies in cultural reasons.
“The Chinese are not so open, and are quite conservative and protective about their business. Most of the small brokers or IFAs do not wish to open up their client information to the network.”
Convoy’s own origins as a small general insurance broker go back to 1993, but in 1998 some of the partners, including Fong, came on board with the plan to turn it into a fully-fledged IFA. From a business with less than 10 people, there are now more than 1,500 consultants.
She explains that in the early days they looked at some of the IFA role models like Towry Law which, although no longer operating in Hong Kong, continues as a significant presence in the UK.
An ambitious goal was set at that time, she recalls: “If we really want to join this industry, we will become the largest IFA in Hong Kong.”
And in terms of numbers of consultants that has come true, though because other IFAs are private companies there are no financial figures to enable comparisons on turnover, profitability or assets under advice.
After the financial crisis of 2008 and 2009, Convoy listed on the stock market to gain funding in a further desire to expand beyond Hong Kong to different regions in the area, enhance their platforms and to put resources into expanding the consultancy force.
A new mindset
Fong grew up in Macau but she came to London to study for her first degree, which was aimed at the building industry rather than financial services. She became interested in financial planning in 1996 when a consultant asked her whether she expected her home to provide the asset base for her retirement.
She subsequently took out a 30 year savings plan with Royal Sun Alliance and she also realised that in Hong Kong people think they will get their money in retirement from the stock market or property.
Financial planning, by contrast, is more long term and a balance of risk and return, which required a new mindset.
Major catalyst
A significant step came in 2000 when the Hong Kong Government launched the mandatory provident fund (MPF), which Fong says is not just a savings habit for retirement but also an education for Hong Kong people “that you need to think about your retirement.” The maximum monthly amount for compulsory contribution for every employee is HK$ 1,200.
Fong has been contributing to the MPF for 12 years since 2000, but she says, “Everyone expects by the time they retire it definitely will not be enough for their retirement in terms of the return and the amount.”
The question then arises of what to do if the sum is not enough, which neatly leads into consideration of financial planning needs for retirement, “And that is always how my consultants start the dialogue with the clients – by talking about the MPF,” she says.
Fountain of youth
Clients at Convoy are relatively young, with 71% of them aged between 25 and 44.
“Do you know why?” she asks rhetorically. “Because our consultants are relatively young and we even take fresh graduates as well. The average age of the consultants is 29, and that means it is not easy for them to meet older clients.”
It is seldom that very experienced individual advisers join. The structure involves a team leader who ensures the team members look after the clients, but also has other responsibilities including recruitment of new staff.
Increasingly, Convoy is taking on more consultants from mainland China on the back of policies in Hong Kong aimed at attracting Chinese students to study in Hong Kong, who also see the obvious job opportunities that Hong Kong offers.
On the investment front, Convoy recommends lump sum and regular savings schemes with a wide range of offshore and local companies, she says, including Friends Provident, Zurich International, Standard Life and to a lesser extent names such as Aviva and Manulife.
Recommendations depend on the underlying funds provided by the different plans, and Fong cites a hedge fund with Friends Provident which used to be the most popular fund among clients.
The form of remuneration is commission, though Fong is open to considering a fee basis in the future, having conducted a study and found that “the Hong Kong people are not ready for it yet.”
Some clients prefer Convoy to select and manage the portfolio on their behalf. This takes the form of a discretionary portfolio management service with an in-house team to actively manage the investments. There is not much tax planning compared with the UK, “because we have low, simple taxes. So it is not a headache here for everyone”.
Diversify money
There are a small number of expats, including a cluster from Japan and also some high net worth clients, “who do not bother with the MPF or retirement” but they are concerned about asset protection and how to diversify their money.
The multi-regulator regime in Hong Kong – the insurance authority, the MPF and SFC – means that the Convoy group of businesses is effectively split into different parts.
The listed company has the licence for the insurance and the MPF only, but a private company called Convoy Asset Management deals with investment in mutual funds and another, a securities broker, facilitates a platform for Hong Kong stocks and futures.
In Hong Kong, compared with other countries, Fong says, “you can see the differences in the pace that we walk, that we talk and that we work. It is much faster. So there is limited time here and we rush to get things done. Everything is about opportunity
and being positive.”
She usually gets into the office from her home in the new territories soon after 9am and depending on what is happening she will leave after 7pm.
Planned expansion
The business plan over the next few years is to carry on with the expansion plan in the region, diversify the product offering and to develop fully holistic financial planning or wealth management platforms for clients.
“With our relatively young client base we are used to providing them with savings plans. But as we grow up together, we need to provide them with more comprehensive wealth management platforms or products as well.”
One of the answers given in a client survey Convoy conducted last year revealed a wish for more insurance products like life cover and critical illness.
“We used to be more investment focused and our clients considered themselves more as investment consultants.”
In Hong Kong there are a lot of insurance agents and the insurance companies have huge distribution. “But as the clients become more educated they know they have more choice and we can provide them with a whole range of insurance products.
Convoy is now an impressive business with ambitious goals and youthful positivity. It is somehow appropriate that Fong cites as her personal motto a quote from famed wartime British prime minister Winston Churchill. “We make a living by what we get, we make a life by what we give.”
