SINGAPORE, Reuters – Singapore’s central banks announced Wednesday that over 400 variable capital corporations (VCCs), have been established or re-domiciled within the city-state since its new corporate structure was created to consolidate its status as a financial center.

Fund managers have greater control over share issuance and dividend payments. They can also set up multiple funds with one VCC in order to lower costs.

You can use VCCs to create a corporate structure that is capable of managing a standalone fund, or a fund umbrella with several sub-funds. You can use them for traditional as well as alternative investment funds. Similar structures are also available in Hong Kong.

According to a survey on asset management, around 300 Singapore-based regional and global asset managers had incorporated more than 400 of them by mid-October according to the Monetary Authority of Singapore.

In January 2020, the new vehicle launched with 20 VCCs. Singapore offers a grant that encourages more of these funds to be located in the country.

According to the survey by MAS, the organization is looking at possible changes to its framework. These could include facilitating conversions of existing investment funds structures or allowing a greater range of entities set up and run a VCC.

The central bank survey revealed that assets under management in Singapore increased 17% to S$4.7 trillion (3.5 Trillion) in 2020, driven by net outflows and valuation gains.

VCCs have proved to be popular among a variety of asset managers such as family offices, private equity, and hedge funds. Despite political instability in Hong Kong, Singapore has been growing in popularity.