VI Asset Management "H20 Fund Redemption Suspension Unrelated to Non-Performing Asset Controversy"

[Asia Economy Reporter Minji Lee] VI Asset Management has stated that the suspension of redemptions by H2O Asset Management is unrelated to any issues of fund asset insolvency.

On the 8th, VI Asset Management, which holds offshore funds managed by H2O through a fund of funds structure, said, "This suspension of subscriptions and redemptions is due to the increased uncertainty in financial markets caused by the spread of the novel coronavirus (COVID-19), which has affected asset value assessments," emphasizing that "it is unrelated to fund asset insolvency."

Earlier this month, VI Asset Management temporarily suspended redemptions of the 'VI H2O Multi-Bond Specialized Private Investment Trust,' which invests in multi-bond funds managed by the European asset manager H2O, and notified distributors of this fact. This action followed H2O Asset Management's announcement of the suspension of redemptions for its multi-bond funds.

Regarding this, VI Asset Management explained, "The French financial supervisory authority recommended H2O Asset Management to take this measure to preemptively prevent uncertainties that may arise during the sale of illiquid assets, unreasonable asset value assessments resulting from this, and unfair discriminatory treatment of investors," adding, "H2O Asset Management accordingly took the proactive step of suspending redemptions." The suspension of subscriptions and redemptions by H2O Asset Management is expected to last about four weeks, after which normal subscriptions and redemptions are planned to resume.

The proportion of illiquid assets included in the funds managed by VI Asset Management is around 5%. A VI Asset Management official stated, "Excluding illiquid assets, the other assets in the fund have been replicated and transferred following H2O's global macro investment strategy, allowing beneficiaries to hold new funds similar to the existing ones," and explained, "H2O Asset Management will receive proceeds from the separation of illiquid assets and will sell these assets within the best possible timeframe."

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