The European Fund and Asset Management Association (EFAMA) has hired Gabriela Diezhandino, the former Head of Public Affairs for Insurance Europe, to head its newly created Public Policy Department.
The new departmentwill work closely alongside EFAMA’s other two specialist divisions – Economics andResearch, directed by Bernard Delbecque and Regulatory Policy, directed by Vincent Ingham. Its primary focus will be on engaging in a constructive dialogue with policy and decision makers to promote EFAMA’s legislative agenda and the views of its members.
This development reflects EFAMA’s commitment to proactive engagement with new and existing political stakeholders through transparent dialogue, and to ensure the industry continues to be represented effectively on the European and international political stage.
As Director of Public Policy, Gabriela will take responsibility for strengthening political and public support for EFAMA’s issues and priorities, ensuring that the industry retains a strong voice and positive representation. Gabriela will also be responsible for developing the best possible political framework within which EFAMA’s members operate, working in collaboration with EFAMA’s Director General, the other two Directors, EFAMA members and industry representatives to identify, pinpoint and develop industry priorities and policies.
A 14-year Brussels and EU affairs veteran, Gabriela joins EFAMA from Insurance Europe, where she was Head of Public Affairs for seven years, responsible for devising and implementing the policy communication and engagement strategies, and promoting the policy messages of the association.
Peter De Proft, Director General of EFAMA, said:“We are delighted to welcome Gabriela to the EFAMA team. The creation of this new role is proof positive of our commitment to engaging constructively with law-makers, and is a particularly important and strategic move for us in the context of the newly elected European Commission and Parliament. Moreover, we needed someone with a strong track record on-the-ground in Brussels allied to an in-depth knowledge of the international financial services industry, and the issues that EFAMA will be engaging with.
“We now enter a new and important phase of political engagement and representation for our industry, and Gabriela will play a key role in making sure that we meet our stated intention to provide leadership and play an enhanced collaborative role with legislators and regulators. We have no doubt Gabriela will prove a worthy addition to our team.”
Blackstone has announced that its Board of Directors has approved a plan to spin off its financial and strategic advisory services, restructuring and reorganization advisory services, and its Park Hill fund placement businesses and combine these businesses with PJT Partners, an independent financial advisory firm founded by Paul J. Taubman. The parties expect the transaction to close in 2015.
The new entity will be an independent, publicly traded company, which will be led by Mr. Taubman, 53, as Chairman and Chief Executive Officer. Prior to founding PJT Partners, Mr. Taubman spent 30 years at Morgan Stanley where he served as Co-President of the Institutional Securities Group. Prior to becoming Co-President, he was the Head of Global Investment Banking and Head of its Global Mergers and Acquisitions Department. Since leaving Morgan Stanley, Mr. Taubman, acting independently, has advised corporate clients on some of the largest M&A transactions in recent years and began building an elite team of senior bankers to form PJT Partners.
Upon completion of the spin-off, Blackstone’s current unitholders will initially own approximately 65% of the new entity. Blackstone’s advisory employees will roll their Blackstone units into the new company and, combined with Mr. Taubman and his partners, will initially own approximately 35% of the company. Mr. Taubman will serve as Chairman of the Board of Directors of the new company, which will also include four independent directors.
Stephen A. Schwarzman, Blackstone’s Chairman, CEO and Co-Founder, commenting on the announcement, said, “Blackstone began as an advisory firm nearly 30 years ago. The decision to spin off these businesses is possible because of our success in growing them over the past 30 years. As the largest alternative asset manager in the world, and with our investing areas considerably broader and larger than even a few years ago, we have not been free to aggressively grow our advisory businesses further out of concern for potential conflicts. The separation of our investing and advisory areas will create new growth opportunities for both businesses.”
Mr. Schwarzman continued, “Paul is one of the preeminent investment bankers in the world. He has had an impressive career over three decades as a strategic advisor to Fortune 500 corporations and as a senior Wall Street executive at one of the most respected financial institutions. With this experience, along with his recent success founding and growing an independent financial advisory business and his proven ability to attract top talent to his new firm, I am confident that Paul will help create the best advisory business on the Street. And, while we will truly miss the daily interaction with our advisory colleagues, we look forward to working with them as clients in the future.”
Added Mr. Taubman, “This is a unique opportunity to combine the legacy, scale and scope of a well-established business while capturing the entrepreneurial energy of a new firm to better serve clients. Further, by eliminating the potential conflicts that existed as part of the world’s largest alternative asset manager, these three businesses will now be positioned for significant growth. The new enterprise will include the leading restructuring franchise on the Street, a market-leading fund placement business and a strategically important advisory practice. By combining resources, we have an opportunity to establish a new leader in the advisory space and the premier destination for talent.”
Excluding capital markets revenues attributable to Blackstone’s Financial Advisory segment that will not be part of the transaction, Blackstone’s advisory businesses generated approximately $380 million of revenue for the twelve months ending June 30, 2014.
The transaction is intended to be tax-free to Blackstone and Blackstone’s unitholders. The completion of the transaction is subject to the satisfaction or waiver of certain customary closing conditions, including the effectiveness of a registration statement with the U.S. Securities and Exchange Commission, the receipt by Blackstone of an opinion from its tax counsel as to the tax-free nature of the transaction and certain regulatory approvals. The transaction will not be subject to a vote of Blackstone’s common unitholders. There can be no assurance that the transaction will ultimately be consummated, or, as to its timing in the event the transaction is consummated.
Simpson Thacher & Bartlett LLP is acting as legal counsel to Blackstone in this transaction. Weil, Gotshal & Manges LLP is acting as legal counsel to PJT Partners.
Las Generaciones. By Roger Langevin artist. Ultra-Wealthy “Millennials” Are Idealistic, But Not Alienated; Challenge Stereotype of the “Idle Rich”
Ultra-wealthy “millennials,” those born between 1982-2000, are idealistic about the uses of their wealth, but say they are generally aligned with the values of their parents as Morgan Stanley Private Wealth Management/Campden Wealth “Next Generation” survey, that looks at families ranging in net worth form $25 million to over $100 million.
“The next generation members of ultra-affluent families are seeking to define their place in the family and find their voices. Education and opportunities will be central to their success. Areas such as philanthropy, values-based investing and entrepreneurism have high appeal with this group and present strong opportunities for engagement”
63% of millennials view themselves as stewards of their wealth for future generations, compared with 46% of older siblings.
58% view their wealth as a vehicle to help the community (vs. 38% of older inheritors).
74% view their wealth as a source of empowerment to pursue what is most important (vs. 54% of older generation).
While they may think differently about their wealth than their parents or grandparents, next generation wealthy of all ages remain close to their families.
95% say they recognize what is important to their families.
64% believe their values are highly aligned with those of their parents.
Only 6% said they have belief systems that differ significantly from their parents.
These are among the findings of a Morgan Stanley Private Wealth Management and Campden Wealth-conducted survey of 87 ultra-high net worth individuals under the age of 40, who come from families with a minimum wealth of $25 million. Over half (57%) had a family net worth of more than $100 million.
“A generation that stands to inherit considerable wealth tells us that the myth of the idle rich is just that – a myth. And, while they may use social media to connect in their personal lives, today’s next-gen wealthy say they prefer to manage their wealth in face-to-face meetings with an advisor,” said Douglas J. Ketterer, Head of Strategy and Client Management for Morgan Stanley Wealth Management.
“The next generation members of ultra-affluent families are seeking to define their place in the family and find their voices. Education and opportunities will be central to their success. Areas such as philanthropy, values-based investing and entrepreneurism have high appeal with this group and present strong opportunities for engagement,” said Mindy Rosenthal, President of the Institute for Private Investors and author of the study.
The myth of the “idle rich”
Among other key findings, the survey discovered that a substantial majority of wealthy inheritors do not plan to live a life of leisure, even though they could afford it.
81% of the wealthy next generation – irrespective of age – believe it is extremely or very important to have a successful career.
68% expect to continue working even after they inherit significant wealth.
In terms of their own spending habits, majorities believe it is extremely or very appropriate to borrow for education (67%), to purchase a primary residence (63%) or to fund a business opportunity, while only 7% believe borrowing to buy personal luxuries is somewhat appropriate.
Millennials are the most risk adverse among next generation wealthy
Perhaps reflecting the volatile market and economic environment in which they grew up, millennials are the most risk adverse of the next generation wealthy:
Only 11% say they are willing to undertake substantial risk for the possibility of substantial gain, compared with 33% among inheritors aged 30-40.
Managing wealth the old-fashioned way
A majority of next generation wealthy across all age groups (63%) believe working with advisors is necessary to make sound financial decisions, and half (49%) say they are extremely or very likely to continue working with their parents’ advisors.
While much is made of the growing power of digital and social media, most next generation wealthy prefer to manage their wealth the old-fashioned way:
82% want more in-person engagement with their financial advisors
74% want to do more business via phone
68% want more e-mail communication
15% want more social media interaction
5% want more communication via internet video/Skype.
Foto: Fondo Monetario Internacional Fotógrafo/Stephen Jaffe - Fotografías de la Reunión Anual del FMI 2007, FMI. ¿Exuberancia irracional 2.0?
The warning signs of new asset bubbles are growing almost by the day. Major institutions, like the International Monetary Fund (IMF) and the Bank for Internatinal Settlement (BIS), as well as individuals who have been right at pointing out bubbles in the past – such as Raghuram Rajan, Governor of the Reserve Bank of India, who correctly anticipated the US real estate bubble – have all started issuing words of warning.
Stefan Hofrichter, CFA, Head of Global Economics & Strategy at Allianz Global Investors, has written a report which was discussed in Allianz GI Investment Forum in Frankfurt last month where he addresses the following issue:
Are we currently witnessing the creation of a new asset bubble or, even worse, a series of asset bubbles fuelled by ultra-easy monetary policy?
The debate should not come as a surprise: US equities were just a few percentage points off their record highs as of the day of writing the report, and other major equity markets have reached all-time highs or multiyear highs over the course of 2014. Bond spreads – be it corporate bonds, emerging market bonds or euro-zone sovereign bonds – are tight by historical standards, albeit not at historical lows. In addition, real estate prices have rebounded forcefully over the past few years in the US, the UK and several euro-area countries. House prices have risen, especially in countries that did not suffer from the burst of a debt-financed real estate bubble at the end of the last decade. This is particularly true for China, other major emerging markets – like Turkey, Brazil and India – and several industrialized markets, notably Hong Kong, Singapore, Canada, Norway, Sweden and Israel. Allianz GI therefore thinks it makes sense to update its research on asset valuation and asset bubbles.
You may access the complete report through this link, though, these are some of the conclusions:
EQUITIES: Based on the cyclically adjusted price-earnings ratio (“CAPE”), also known as “Shiller PE”, global equities look roughly fairly priced and in line with long-term average multiples. European equities, especially in the periphery, even look cheap on this metric. The same holds true for emerging market equities, which are again trading at a discount of around 20 % compared to equities from industrialized countries and are at their lowest valuation reading since 2006 – and at a similar discount as they were in the mid-1980s.
While US equities today are undoubtedly at high multiples compared to their own history, valuations are not in bubble territory and do not preclude a further rise in stock prices. Current valuations are no reason to become ultra- cautious on equities at this juncture, even though current valuations are likely to imply below-average real returns in the coming decade if past experience is a guide for future developments.
BONDS:High-quality sovereign bonds, such as US Treasuries, UK Gilts and German Bunds, are trading significantly below what Allianz GI thinks are nominal trend GDP growth rates, which should be the long-term reference value, based on both economic theory and past experience. Nevertheless, Allianz GI is more relaxed about the valuation of non-German euro-area sovereign bonds relative to Bunds.
Compared to the beginning of the year, though, the valuation assessment today is less favorable for corporate bonds, even though spreads compared to sovereigns are higher today than they were just before the burst of the real estate bubble. This statement is particularly true for high-yield bonds, be it in the US or Europe.
Emerging market bonds issued in hard currencies (benchmark: EMBI+) are reasonably priced, according to Allianz GI’s report. Still, the manager finds that local currency bonds offer better value: first, because of the higher yields compared to sovereign bonds from developed markets; and second, because they also expect additional gains from currencies, which look undervalued in the calculations based on Allianz GI’s long-term valuation approaches.
Jaime Cuadra. Photo: Lindein. Jaime Cuadra Joins the Business Development Unit at Compass Group Asset Management
Jaime Cuadra has recently joined the ranks of Compass Group Asset Management from Mercantil Commercebank, following the departure of Rafael Tovar, who left the Chilean company to join Nikko AM.
Jaime Cuadra Jr. joined Compass Group as Vice President where will be responsible for leading the business development efforts out of New York for institutional clients globally in the United States, Europe, Asia and Middle East, while also covering key accounts in Miami and New York for private banks, and family offices. Prior to that, he worked for 9 years at Mercantil Commercebank (Miami) where he held positions as an internal consultant managing projects and most recently as an Associate on the Products team for the bank’s broker dealer and registered investment advisor.
He holds a Bachelors of Science degree in Industrial and Systems Engineering from Florida International University as well as Bachelors in Finance from Nova Southeastern University. He is bilingual in Spanish and English.
Ezentis' Chairman, in Madrid Stock Market. Courtesy photo. Spain's Ezentis Group Achieves a New Contract from Vivo in Brazil
Ezentis Group, through its subsidiary in Brazil, Serviços e Engenharia Instalação of Comunicações (SEICOM) has been awarded a contract for works of installation and maintenance of mobile network sites of the company Vivo (Telefónica Brazil) amounting to 96,194,366 reais (31.5 million euros).
The contract – which have a duration of three years – plans to manage the installation and maintenance works of the mobile network Vivo in the states of Rio de Janeiro and Espírito Santo.
Ezentis has increased its portfolio of contracts in Brazil amounting to 198 million euros since it presented to investors and analysts the 2014-2017 Strategic Plan on April, 2. This Plan involves placing Brazil as the main market for the company with a weight of 37% in sales in the coming three years.
Ezentis is an entrepreneurial group with presence in nine Latin American countries, whose goal is to improve the quality of life of people in over 15 million homes, through total satisfaction of the telecommunications, energy, and water operators in the region. Ezentis bases its vision on two solid pillars: innovation and social corporate responsibility, because by working to improve work and workers’ productivity it is able to guarantee greater satisfaction of its clients, greater security for their workers, and a positive environmental impact.
Courtesy photo by DeVanx Assets. Fancy Red Diamonds Emerge as New Asset Class
DeVanx Assets, a Swiss rare mineral investment advisory, has reported that demand for red diamonds among institutional, ultra-wealthy investors, and intermediaries is surging as their value continues to increase. Red diamonds are one of the rarest minerals in the world and the highest quality of these diamonds have more than tripled in value in the past decade.
One of the most anticipated red diamond events, Rio Tinto’s annual Argyle tender, is currently creating a global bidding war featuring the Argyle Cardinal, a rare red 1.2–carat diamond, 3 additional reds, and 51 Argyle pink and purplish-red diamonds. Experts say the highest quality investment worthy red diamonds can command up to $2.5 million a carat. Only 13 fancy red diamonds have been included in the annual tender during the past 30 years. This year’s tender ends on October 8, 2014.
Accordingto Paula Vance, CEO of DeVanx Assets, her company has standardized the red diamond industry by tracking data including sales and pricing over the past 50+ years from the entire supply chain, mining to investors.
“The careful review and selection of an investment grade red diamond is critical to enjoy the highest ROI for these stones,” she said. “While certainly beautiful and precious, not all red diamonds are of investment quality. The best in red diamonds have become a new asset class offering stable value appreciation and low volatility, and are an excellent inflation hedge and substitute for gold and other precious metals.” Accordingto DeVanx’s in-house GIA Master Gemologist, Doris Hangartner, only 126 investment grade fancy red diamonds are known to exist in the world today.
DeVanx Assets offers exclusive access to 82% of the world’s limited supply of open market investment grade red diamonds. It provides customized asset packages meeting client specifications and liquidity programs to allow investors to capture capital in six to 12 months versus the typical three to five years.
“Our client base is shifting,” says Vance. “While the majority is institutional, such as independent wealth managers, private banks, intermediaries and family offices, more Ultra High Net Worth Investors are seeking to directly invest in red diamonds. These investors hail from all over the world: Europe, Russia, China, Japan, Korea, U.S., Canada, and South America.”
Photo: Ork.ch. JP Morgan Recruits María Ángeles Arias to Join its Team in Switzerland
As was reported to Funds Society by sources familiar with the appointment, Maria Angeles Arias, from AndPrivateWealth in Geneva, joins JP Morgan Suisse to take up her post as senior banker for the company’s Mexican team.
With over 13 years experience in private banking, Arias worked for over two years as Senior Banker, also for Mexico, at Andbank’s AndPrivateWealth. She was previously relationship manager for Santander Private Banking for a period of 11 years during which she worked from Madrid, Miami and Geneva.
Arias, a graduate in Law from the Complutense University of Madrid, has a Master in Financial Markets from the “Instituto de Estudios Bursátiles” (IEB, Madrid), and a Management Development Program (MDP) from the IE Business School, as is listed in her Linkedin profile.
ETFGI’s research finds ETFs and ETPs globally have gathered a record US$199.0 Bn in net new assets through the end of Q3 2014, surpassing the previous high of US$185.8 Bn set in the first three quarters of 2012. The Global ETF/ETP industry has 5,463 ETFs/ETPs, with 10,510 listings, assets of US$2.6 Tn, from 225 providers listed on 61 exchanges, according to preliminary data from ETFGI’s end Q3 2014 Global ETF and ETP industry insights report.
YTD NNA flows reached record levels for the ETF/ETP industries in Japan at US$15.0 Bn, Europe at US$47.4 Bn, and globally at US$199.0 Bn.
“In September investors invested the majority of net new money into North American equity exposures. Due to the on-going situation in the Ukraine, Scotland’s referendum vote, and the Bank of England Governor’s statement that a rate increase was “getting closer”, investors reduced their exposure to Europe. The unfavourable geopolitical environment caused the S&P 500 to decline 1% in September. Developed markets declined 4% while emerging markets declined 7%.” according to Deborah Fuhr, Managing Partner at ETFGI.
In September 2014, ETFs/ETPs saw net inflows of US$13.2 Bn. Equity ETFs/ETPs gathered the largest net inflows with US$14.8 Bn, while fixed income ETFs/ETPs saw net outflows of US$449 Mn and commodity ETFs/ETPs experienced net outflows of US$1.5 Bn.
SPDR ETFs gathered the largest net ETF/ETP inflows in September with US$10.5 Bn, followed by Vanguard with US$7.0 Bn, First Trust with US$939 Mn, Van Eck with US$858 Mn and Wisdom Tree with US$789 Mn.
iShares is the largest ETF/ETP provider in terms of assets with US$980.3 Bn, reflecting 37.3% market share; SPDR ETFs is second with US$431.6 Bn and 16.4% market share, followed by Vanguard with US$406.8 Bn and 15.5% market share. The top three ETF/ETP providers, out of 225, account for 69.3% of Global ETF/ETP assets, while the remaining 222 providers each have less than 4% market share.
Mario González-Pérez and Álvaro Fernández Arrieta. Courtesy photo. Capital Group Opens Office in Madrid with Álvaro Fernández Arrieta and Mario González
Capital Group has opened its first office in Spain, in Madrid, as part of its expansion plans in a number of strategic markets (11 in total) outlined at the start of 2014.
The Madrid based Business Development Managers are Álvaro Fernández Arrieta and Mario González Pérez.
Grant Leon, head of Sales, Private Wealth Distribution at Capital Group, said: “Spain is an important market where we are seeing demand from existing and prospective clients for investment managers that offer long-term stability. We are very happy to announce the establishment of our new office in Madrid, demonstrating our commitment to Spain. Working with clients in their home market is key to ensuring that we continue to understand and anticipate their needs and provide a personal and efficient service.”
Fernández Arrieta joined Capital Group from Amundi Asset Management in July 2014 with over twenty years’ experience in the sector, while González Pérez has been with Capital Group for over 10 years.
Both will be responsible for nurturing relations with existing clients, and for developing new business opportunities, in Spain.
Capital’s equity offering includes US, European and emerging markets funds. Its fixed income offer focuses on high yield and emerging debt. Capital Group’s entire range of strategies, which comprises 20 Luxembourg funds, is registered in the Spanish market.
