Asia is a Story of Productivity and Domestic Consumption

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“El consumo doméstico en China está en el equivalente norteamericano de la década de 1950”
Robert J. Horrocks, CIO, and Jonathan D. Schuman, Head of Global Business Development at Matthews Asia . Asia is a Story of Productivity and Domestic Consumption

Today, markets are dominated by monetary policy, and the environment is complicated in general. Central banks are acting more for either political reasons, as in theECB’s case, or academic, as in the case of the Fed, than for economic reasons, but ultimately, we should be aiming towards more average standards in interest rates. What effect does this have on emerging markets? Robert J. Horrocks, CIO and portfolio manager at Matthews Asia believes that in such environments, the best position is to invest in markets that are independent of the evolution of demand in Europe and the U.S., “Therefore, Asian markets, which are more focused and sensitive to domestic consumption, may be an attractive place to invest.”

At a lunch presentation for a small group of investors in Miami, Horrocks pointed out how, in general, Asian markets have been those which have made the greatest advancements in improving their GDP per capita in relation to that of the U.S. during the last 30 years. Countries like South Korea have gone from having a GDP per capita which was equivalent to 20% of that of the U.S. in 1980 to currently (2010) running very close to 80%. The relative progress for Taiwan is also spectacular, and very noticeable in the case of either China or Thailand. “The secret of these markets is simple, work very hard and save your money, that’s how these countries have reached the point where they are now.” Asia is, notes Horrocks, a story of productivity and domestic consumption. In fact, productivity contributes nearly 3 percentage points to GDP growth in countries like China, despite the wage increase, “it is not affecting corporate profits as workers are becoming increasingly more productive and are thus helping the country to sustain a GDP growth of 7% without the assistance of exports”.

However, in recent years, the region has not had a prominent stock market performance. While in the U.S. profit margins have not done anything but improve, in Asia, they have fallen from an average of 9.84% for the EBIT margin during the period 2001-2008, to an EBIT margin of 7.60% during the period 2009-2014. “The margin squeeze is the main reason why Asian markets have underperformed, although in the last year there has been a stabilization, so the growth in earnings per share in the region is catching up to that of the developed world.”

This, coupled with an attractive valuation in absolute terms (according to the consensus, China is trading at an estimated 2014 PER of 9.7x) and especially in relative terms (the U.S. trades at 15.7x according to the same ratio), and the implementation of reformist governments in China, India and Japan, support investment in the region, but above all Asia is “a story of domestic consumption and middle class boom.”

If the current GDP percapita of several Asian countries is placed in a historical context the conclusions are emphatic. There are a significant number of countries which have a percapita GDP equal to that enjoyed by the U.S. in the nineteenth century, for example India, Philippines, Vietnam, and Pakistan. However much China has progressed in recent years, it is still at the stage that the U.S. was in the 1950s in terms of GDP per capita, while Thailand and Malaysia are not much better and have yet to go through the boom of appliances, tourism, and mass consumption. The more developed markets such as Korea and Taiwan are still in the 1980s; only Singapore and Hong Kong has positioned themselves on the threshold of the 21st century.

As Asianmarkets go reaching the same levels as those in developed countries, “based on working hard and saving,” as Horrocks pointed out at the beginning of this conversation, it opens “huge opportunities for companies that can exploit the consumer boomof the middle class.” The projections presented by Horrocks pointed out that in 2015, the consumption of the middle class in the Asia Pacific region will represent 30% of the total globally. This percentage will rise to 70% in 2040 at Europe’s and North America’s expense.

Toposition their portfolio accordingly, Horrocks’s team discusses the size of certain industries and even individual consumer companies currently operating in the U.S., as an estimate of where their Asian peers could be in a few years. “For example, we identified that the fast food chain business model has incredible potential within the region, while restaurant chains don’t have the same projection. Another area where we definitely want to be present in the future is that of insurance.” Once we identify a sector or business model “we match that with companies available for investing within the region,” adds Jonathan D. Schuman, director of Global Business Development at Mathews Asia, who accompanied Horrocks the presentation. “Likewise, one of the sectors that we like is healthcare, but there are very few companies in Asia where you can invest on that area, so we are very overweight in relation to the benchmark.”

“We are well awarethat when the middle class emerges, it starts consuming not only products, but mostly intangible services, so we see the huge opportunity which exists long-term in sectors such as the afore mentioned insurance and health,” Horrocks added.

The company’sChief Investment Officer concludes by calling attention to the growing importance of dividends as part of the performance of a portfolio invested in Asia. “We like companies that deliver increasing dividends, not only to provide additional yield to our investment, but also because in a market that suffers from questionable and opaque corporate governance, companies that are committed to paying dividends by force are more transparent in their accounts,” says Horrocks.

Markets are Considerably Driven by Herd Behavior

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El “efecto manada” está guiando a los mercados
Photo: Ken Hammond. Markets are Considerably Driven by Herd Behavior

In its last MarketExpress report, ING IM shares its view about the recent setback in the markets: “the reasons for the recent sharp decline in risky assets must primarily be sought in investors’ herd behavior. We admit that some fundamentals – especially in the Eurozone – have weakened, but data suggest that global growth momentum remains intact.”

The asset management firm recons it is not always easy to make sense of the financial market jitters that have plagued us over the past few weeks. When looking for an explanation, it is clear that market technicals should be high on the list. “In this respect we note that the very low interest rates have pushed new types of investors towards risky assets; investors who lack experience with equity investments. As a consequence their behavior is resembling tourists in equity markets who have difficulties to stick to their positions in uncertain times. Instead, they seem more inclined to herd behavior.”

In the meantime, data suggest that global growth momentum remains intact. “Therefore, we stick to our overweight positions in equities (small) and real estate (medium). Having said this, we admit that questions about the underlying fundamentals have also played a role in the market unrest”.

A concern is that markets may disconnect with the real economy

Amidst all uncertainties to ING IM one thing is absolutely clear: There are many moving parts in fundamental space and investors have difficulties to get grip on these parts. This situation is pretty conducive to eliciting bouts of market volatility. Loose global monetary policy has been acting as a very important “dampener” of market volatility. However, in periods in which this dampener is somewhat less effective in calming markets, one invariably starts to hear increased worries that markets may be getting way ahead of the real underlying economic situation.

ING IM thinks there is no widespread overvaluation in risky assets

The firm is clearly not in the camp that believes in widespread overvaluation in risky assets. They give two arguments for their continuous positive view on equities (small overweight) and real estate (medium overweight).

1. Global growth momentum remains intact

Data suggest that global growth momentum remains intact. The Global PMI continues to hover in a range consistent with moderately above potential global growth. Momentum in global retail sales has picked up over the past few months and will receive a further boost from the sharp fall in commodity prices.

2. Global Economy has support from dollar, oil price and yields

Lower oil prices are favourable for disposable incomes of households. Besides, companies will benefit, due to lower input costs. Lower US bond yields imply breathing space for emerging markets. Finally, the stronger dollar is favorable for economic and earnings growth in Europe, Japan and the emerging world.

Transearch International Opens an Office in New York, Placing Carolina Molloy at the Helm

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Transearch International abre una oficina en Nueva York y pone al frente a Carolina Eiris Molloy
Carolina Molloy. Courtesy photo. Transearch International Opens an Office in New York, Placing Carolina Molloy at the Helm

The headhunters’ firm Transearch International has opened an office in New York, which will be headed by Carolina Molloy, a professional with over 20 years experience in the financial and consultancy sectors, who has developed her career between Caracas, Miami, and New York, as she explained to Funds Society.

Transearchhas decided to take the leap into New York, which is the undisputed financial center par excellence, and finance is one of the most important business sectors for this headhunter company based in Miami.

Molloy said in this regard that, “Miami is a major financial center, but undoubtedly, there are certain things which are handled in New York, and that is the reason why Transearch has decided to open an office here,” added Molloy, who is also senior client partner of the company.

Molloy will work closely with Mar Hernandez, head of Transearch’s financial department in Miami, and who, to date, has also worked with clients in New York, some clients will remain under Hernandez’ umbrella, who from now on will be supported by Molloy on the ground.

Likewise, Molloy has the mandate to develop Transearch’s business in New York and attract new customers to the company.

Molloy comes from the First Manhattan Consulting Group, a boutique management consulting firm specializing in financial services, where she specialized in financial services and where she had been working for three years. For Molloy, Transearch is a natural area in which to work given her professional experience, this job will allow her to further leverage her knowledge to transfer it to her new professional field.

Molloy, a systems engineer from the Metropolitan University of Venezuela, has an MBA in Financial Management from the MIT Sloan School of Management. She worked for several years at Citi, both in Caracas and in Miami, where she held various positions in the areas of Consumer and Product and for two years headed that company’s second-largest branch in Miami. Earlier in her career she worked in Socit Gnrale in Budapest and in the global consulting firm Accenture in Venezuela.

Investec AM Gathers Over 200 Investment Professionals in London for its Global Insights Conference

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Investec AM analiza en Londres junto a 200 profesionales los temas clave y motores de los mercados de inversión
Photos: Funds Society. Investec AM Gathers Over 200 Investment Professionals in London for its Global Insights Conference

Last week, and for the seventh consecutive year, Investec Asset Management held its Investec Global Insights 2014 conference in London, bringing together more than 220 professionals from around the world.

Clients from Latin America, United States, Asia, Europe and the UK, from first class institutions like UBS, Citi and Morgan Stanley, amongst others, met in the English capital to work through key issues and drivers of the various investment markets, where they had the opportunity to meet the company’s leading portfolio managers.

The asset management company invited an externalspeaker for the first time, and after a few words of welcome from Investec AM’s managing director, Richard Garland, Peter Oppenheimer, Chief Global Equities Strategist at Morgan Stanley, signaled the start of the event. The conference was marked by an atmosphere of nervousness among the attendees after recent market events; with the S&P reaching all time intraday highs, the general lowering of expectations for growth, and rising deflation after the reduction of inflationary pressures.

For Oppenheimer, “these movements are not consistent with normal cycles. We are in an environment of relatively low growth, although it is true that companies have cash to spend. Their relative valuations will serve as support for equities. Growth in emerging markets will be key, but differentiation is to be expected.”

When Garland launched the audience a question as to which is the preferred region in which to invest in equities, most argued for Europe. The South African firm is also positive with European equities, while acknowledging that there is a need to be selective. “What is clear is that none of our managers are buying ‘plain vanilla’ companies, says Philip Saunders, Co-Head of Multi-Asset. Meanwhile, James Hand, Co-Head for 4Factor Equities, is confident that interesting opportunities are to be found in Scandinavia and Germany, while he leaves the UK out of his radar screen. Clyde Rossouw, Head of Quality, is committed to global European businesses that are making part of their bottom-line externally and he acknowledges that Nespresso is currently his favorite bet.

John Stopford, co-head of the Multi-Asset team, was on hand to try to provide an answer together with his colleagues, to the difficult question of whether it’s possible to find sustainable sources of income, as low interest rates policies have hindered the returns of the safest assets. The search for yield will be supported by demographic issues, policies of low interest rates and low volatility. So, how do we generate income without taking risks?

According to Stopford, credit seems to be the most vulnerable asset. Yields on corporate bonds are close to touching the lowest levels historically, and they are susceptible to an increase in both yields on government bonds and volatility. Furthermore, over exposure to high-yield market makes it unstable and prone to sufferingwhen the time comes to absorb significant volumes of sales, which would result in a lack of liquidity.

The expert assures that credit tends tosell before shares. In previous cycles, six to 18 months have elapsed before the peak in equities.

Profits are usually the driving force behind equities, moving largely to the rhythm of the economic cycle. Credit spreads are closely linked to the uncertainty in profits and volatility. Uncertainty tends to increase as we approach the end of the cycle.

 “The equity market is likely to still have some way to go. Unlike bonds, stock returns are quite high by historical standards. Even so, we are at a favorable moment for equities, in an environment where profits are improving,” said Stopford. “In addition, dividends and growth thereof are likely to remain important drivers for investment in a world of relatively low growth,” he adds.

Meanwhile, Alex Moss, Real Estate consultant, says that the housing sector remains a good source of income. “The cash flow of companies within this sector is improving in general terms and its dividend yield is growing. They also have strong balance sheets and relatively low levels of debt.”

During thepanel, Victoria Harling, portfolio manager for Emerging Markets Corporate Debt, claimed that emerging bonds in local currency offer better value than in hard currency, as they are vulnerable to a widening of credit spreads in developed countries. “In addition, local currency bonds are trading at a decent premium if we analyze historical returns. Emerging currencies are cheap, but not outrageously so, so it makes sense to use them to finance exposure to the Euro or other non-USD currencies.”

In short,managers at Investec Asset Management consider that a wisely built and actively managed portfolio can reduce risk.

And,how can that be achieved? The management company recommends a diversified portfolio, choosing stocks with low beta, managing the risk of bond duration, and covering the risk tactically when it appears markedly.

Loomis Sayles Appoints Director for Institutional Services in Asia

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Loomis Sayles Investments Asia has announced that Michael Chang has joined the company as Director, Institutional Services, Asia. Michael will report to Paul Ong, managing director of Loomis Sayles Investments Asia Pte. Ltd. and head of the Loomis Sayles Singapore office. Michael will also report to John Gallagher, executive vice president and director of institutional services for the company’s US, Canadian, UK, and Singapore offices.

Michael joins from Natixis Global Asset Management, the parent company of Loomis Sayles. In this new role, he will provide critical support and guidance on Loomis Sayles investment strategies and products to the Natixis business development offices throughout Asia. In particular, Michael will play a key role in further developing and building strategic relationships for Loomis Sayles in the North Asian region.

“We are very pleased to welcome Michael to our team,” said Paul Ong. “We have had a great working relationship since the Loomis Sayles Singapore office opened its doors in 2012 and while at Natixis, Michael did a fantastic job raising assets on behalf of Loomis Sayles in Taiwan. With his wealth of experience and deep knowledge of the North Asian markets, I’m confident Michael will be a key contributor to the continued success of Loomis Sayles Singapore as we seek to further bolster our investment capabilities and drive the growth of our Asian client base to the next level.”

Michael worked for Natixis for 11 years and was most recently the managing director of Natixis Taiwan. Michael earned his Bachelor of Business Administration from Tam Kang University in Taiwan and a Master of Commerce (Accountancy) from the University of Wollongong, NSW, Australia.

BBVA Compass Appoints Florida Business Leader to Its National Advisory Board

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Civic leader and business executive Marielena Villamil has been named the 22nd member of BBVA Compass‘ National Advisory Board, which is made up of executives from across the bank’s Sunbelt footprint.

Villamil is the co-founder and president of The Washington Economics Group Inc., an economics consulting firm based in Coral Gables, Fla. Villamil, who serves on several community boards, earned her master’s degree from Vermont’s Middlebury College and her bachelor’s degree from St. Mary’s Dominican College in New Orleans. She will continue to serve on the bank’s South Florida board, which she joined last year.

“Marielena has done an amazing job promoting the bank in South Florida during the past year, and she’s even attended a BBVA shareholder’s meeting in Spain to learn more about the bank,” said BBVA Compass South Florida Market President Roberto R. Munoz. “We’re so proud to have someone from Miami sit on our national board.”

National board members help generate business for the bank and provide BBVA Compass leaders with insight about financial needs in specific markets and industries.

The Typical UHNW Philanthropist Donates US$25 Million During Lifetime

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The Typical UHNW Philanthropist Donates US$25 Million During Lifetime
Foto: Dennis Jarvis. El filántropo medio UHNW dona 25 millones de dólares a lo largo de su vida

Wealth-X and Arton Capital released this week a report that reveals that the typical ultra-wealthy philanthropist donates US$25 million over the course of his or her lifetime, is 64 years old, has an average net worth of US$240 million, and an average liquidity of US$46 million.

These are some of the findings of the inaugural Wealth-X and Arton Capital Philanthropy Report 2014 that examines the full spectrum of ultra high net worth (UHNW) philanthropic activities, identifies trends in UHNW giving, provides the profile and traits of ultra wealthy philanthropists, and highlights their motivations in contributing to charities across a range of areas and sectors.

The Wealth-X and Arton Capital Major Giving Index, which tracks trends in UHNW charitable giving, shows that the level of traditional philanthropic donations remains strong. The index has risen in the past few years, reaching a level of 220 in 2013 – making it the strongest year for UHNW giving since the 1997-8 global financial crisis, and only 12 points below the all-time high of 232 in 2006.

However, the report reveals that UHNW philanthropists are expanding their philanthropic approaches and activities, shifting from major giving towards self-sustaining projects and entrepreneurialism.

Here are some other key findings:

  • Major giving to educational causes accounts for 40 per cent of all UHNW donations, three times more than the amount given to health causes.
  • Individual gifts by UHNW female major donors, on average, is 26 per cent larger than their male counterparts.
  • The global UHNW population, which comprises 0.003 per cent of the world’s population, holds 13 per cent of the world’s total wealth.
  • Nearly 70 per cent of UHNW philanthropists are self-made and actively contribute to programs that aim to increase entrepreneurialism.
  • Impact investments, such as social bonds, will account for 1 per cent of professionally managed assets within the next 10 years.
  • On average, American households donate US$3,000 annually to charity. A UHNW philanthropist with a net worth of between US$30-49 million typically donates at least US$60,000 annually.
  • Billionaires give the most to charity. On average, members of this top-tier wealth segment have donated US$108 million in their lifetime.
  • Philanthropic bequests are expected to reach US$86 billion in the next 10 years.

The report is supported by knowledge partners, Charities Aid Foundation, Global Citizen Foundation, International Youth Foundation and Population Services International, who provide commentary and case studies.

 “Globally, we are witnessing an evolution of philanthropy as it expands from ‘traditional’ philanthropy – involving financial contributions and donations – to cutting-edge approaches such as venture philanthropy, microfinance, impact investing and job creation,” said Mykolas Rambus, CEO, Wealth-X. “Ultra wealthy philanthropists are increasingly focusing on philanthropic initiatives that provide long-term solutions by enabling the less fortunate to seize opportunities through entrepreneurialism, and using their own business acumen to measure the effectiveness of their philanthropic endeavors and to maximise their returns.”

“This is another initiative in our corporate strategy to encourage the discussion about the responsibilities of global citizens in addressing the social and economic dimensions of sustainable development,” said Armand Arton, President and CEO, Arton Capital. “Our strategy includes sharing more and more information about the role of the wealthy in these important processes. One of our strategic goals is to engage all involved stakeholders in a constructive dialogue on how to more efficiently interconnect global citizens so that their joint efforts become a force for bridging the widening socio-economic gap.”

Generali Investments Europe Opens the 
Absolute Return Credit Strategies Fund to New Investments

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Generali Investments Europe Opens the 
Absolute Return Credit Strategies Fund to New Investments
Andrea Favaloro, director de Ventas y Marketing de Generali Investments Europe. Generali Investments Europe abre el fondo Absolute Return Credit Strategies a nuevas inversiones

Generali Investments Europe SpA SGR – the main asset management company of the Generali Group with €355 billion of AuM – has recently opened for new investments the Generali Investments SICAV Absolute Return Credit Strategies fund. The fund is now available to investors looking for solutions and instruments to reach their investment return targets in a low interest rate scenario without running high volatility risks typical of an equity exposure.

By profiting from Generali Investments Europe’s extensive expertise in fixed income and absolute return strategies, the AR Credit Strategies fund uses all yield sources offered by the fixed income and credit markets in order to seek to achieve above-average performance. The fund targets a 4% yearly return.

Andrea Favaloro, Head of Sales & Marketing at Generali Investments Europe, commented: “The re-launch of the AR Credit Strategies fund is another fundamental pillar of our strategy aimed at international third-party clients. AR Credit Strategies will provide them with a unique tool to fight the zero interest rate environment through high-potential fixed income investments while at the same time keeping risk and volatility to a minimum. Our investment choices are supported by a large and experienced in-house team with an outstanding proven track record.”

The AR Credit Strategies fund, whose core investment universe is composed of Investment Grade, High Yield, Emerging Markets and Convertible Bunds notes, is managed by a portfolio management team headed by Filippo Casagrande, Head of Investments at Generali Investments Europe. Casagrande has over 20 years of asset management experience and has been at Generali Investments Europe since 2009. He graduated in Economics from Bocconi University, Milan. Fabrizio Viola, 12 years of experience, will be deputy Portfolio Manager.

The portfolio management is supported by 12 macroeconomic analysts with 16 years of average experience who provide market outlooks and views. Furthermore, there are 12 credit analysts with 11 years of average experience who provide in-depth analysis on the corporate bond market. All activities are controlled by the risk management team, which is actively involved in the process, to ensure all risk guidelines – including a VaR capped at 6% – are met.

Since May 2014, Generali Investments SICAV Absolute Return Credit Strategies has more than doubled its fund volume to more than €520 million.

European Frontier Markets: Focus on Romania Prior to its Presidential Elections

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In September 2014 Global Evolution visited Romania to get better insight on whether there is any upside to the current slow growth environment in the coming quarters. With respect to the weak growth and low inflation Lars Peter Nielsen, Senior Portfolio Manager at the firm, was also interested in getting a stronger sense of the subsequent path of monetary policy. Furthermore he wanted to examine if the current IMF program is dead or if there is reason for optimism with respect to reactivating the program after it went off-track during the summer. Finally, the aim was to get a better sense of possible surprises in the presidential elections (1st round scheduled for 2 November), or if incumbent Prime Minister Victor Ponta is a certain winner.

During the trip Global Evolution met with Central Bank officials, government officials, IMF, World Bank, local banks and local asset managers. These are some comments by Lars Peter Nielsen on the key findings from this trip.

Recession in H1 2014

After a reasonably strong economic performance in 2013 growth has slowed dramatically in 2014 thereby leaving the country in technical recession in the first half of 2014 with two consecutive quarters of negative growth.

It is primarily investments that have taken a big hit in the last couple of quarters.

According to the Ministry of Finance we will see stronger public investments in the second half of 2014 as several projects co- financed with the EU will start coming online. Furthermore, the government has already announced that the “special construction” tax will be lowered again, which should help private investments as well. Finally private consumption is also expected to pick up. All that said it is unlikely that we will see a strong economic rebound and full year 2014 growth is likely to settle in the 1.5-2.0% range. For 2015 most market participants expect growth around 3%, which in our opinion would be a reasonable growth rate. However, we are also a bit skeptical since the government will have to tighten its fiscal stance further if it is to comply with the demands from EU.

Inflation running very low

Like most of Eastern Europe inflation is running very low and as for the rest of the region a lot has to do with declining food inflation, weak growth and deflationary pressure from the Euro zone. It is very difficult to see inflation in the short to medium term moving above the Central Banks target of 2.5% +/- 1%-point.

Expansionary monetary policy

The backdrop of weak growth and low inflation has seen the Central Bank pursuing a relatively expansionary stance which has resulted in a 725bps cut in the policy rate since the peak in 2008 of which 200bps have been cut since July 2014. Currently the policy rate stands at just 3%. The Central Bank will be very vigilant about the exchange rate and adjust the short term rate accordingly to secure a very stable EURRON in the 4.40 – 4.45 range. This means higher interest rates whenever there is pressure on the currency. The bank’s sensitivity towards the exchange rate is due to the high pass- through to inflation and the still relatively high level of FX denominated borrowing by households and companies. That being said we still believe the Central Bank is biased towards pushing rates lower whenever there is room for it.

IMF program off track

The current stand-by program (SBA) went off track in June when the IMF visited the country for the third review under the program. The disagreements are on some structural reforms, privatizations and not least uncertainties on the 2015 budget. The IMF is aware that it is impossible to make adjustments to the budget ahead of presidential elections in November so the fund has agreed to postpone negotiations till after the elections. From a funding perspective the program is not important but it is still a good anchor to have and it would be a negative signal if the program was cancelled. We think the program will come on track again even though the negotiations will be tough.

Politics – Victor Ponta most likely the next president

Current Premier Minister Victor Ponta remains favorite to win the presidential elections in November but it is not a given. Apparently the opposition candidate, Klaus Werner Iohannis, from the National Liberal Party is gaining ground and is now seen as a serious contender. Klaus Werner Iohannis has been the mayor of Sibiu since 2000 and is credited for turning Sibiu into one of the most popular tourist destinations in Romania. We don’t see the election as a real risk since either we will have more or less the status quo of Victor Ponta, albeit with changes to the government since Ponta can obviously no longer be prime minister, or we will have an even better outcome if Klaus Iohannis wins.

Valuations

Even though nominal yields have been on a long term downward path we still think that valuation is reasonably attractive since real rates have moved higher due to the very low inflation. That being said we are very much aware of a possible uptick in inflation later in the year and will react promptly to higher food inflation numbers.

The exchange rate also seems reasonably fairly priced if you look at long term REER trends with the current level very close to the 5 year moving average. Furthermore we believe the Central Bank will hold the currency very stable against the EUR in the 4.40 – 4.45 range for the remainder of 2014.

To conclude we are neutral on Romania FX vs. EUR but see further possible gains in the bond market during Q4, 2014. We will be very mindful for a possible uptick in food inflation that can put upward pressure on headline inflation and end the downward trend in nominal yields.

Lars Peter Nielsen, is Senior Portfolio Manager at Global Evolution.

Global Evolution, an asset management firm specialized in emerging and frontier markets debt, is represented by Capital Stragtegies in the Americas Region.

You may access the full report through the attached pdf file.

Credit Suisse Makes Changes in the Leadership of the Investment Banking Division

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Credit Suisse Makes Changes in the Leadership of the Investment Banking Division
Tim O’Hara. Foto de Credit Suisse. Credit Suisse anuncia cambios en su Comité Ejecutivo y en su banca de inversión

Credit Suisse announced appointments to the Executive Board, changes to the leadership of its Investment Banking Division, and the appointment of a new CEO of Asia Pacific. These changes will take immediate effect.

Jim Amine and Tim O’Hara have been appointed to the Executive Board and will join Gaël de Boissard to head the Investment Banking Division.

Helman Sitohang will assume the role CEO of Asia Pacific.

Eric Varvel has decided to step down from the Executive Board and assume the role of Chairman Asia Pacific and Middle East Regions.

Gaël de Boissard, Jim Amine and Tim O’Hara will partner in leading the Investment Banking Division. Jim Amine will continue to have responsibility for the Investment Banking Department, while Tim O’Hara will continue to head the Equities business. Gaël de Boissard’s role remains unchanged. He continues to head the Fixed Income business and remains the CEO of Europe, Middle East and Africa and a member of the Executive Board. Jim Amine and Tim O’Hara will join the Executive Board and report directly to the CEO.

Helman Sitohang will assume the role of CEO of Asia Pacific, reporting directly to the CEO. He will also continue to retain his role as Head of the Investment Bank for Asia Pacific. APAC is the region with the highest economic growth and Credit Suisse is continuing to allocate additional resources to accelerate and maximize the growth opportunities in this region.

Eric Varvel will assume the role of Chairman Asia Pacific and Middle East with a primary focus on our most important clients and assisting senior management on strategy. Eric will step down from the Executive Board, but will continue to report to the CEO in his new role.

Urs Rohner, Chairman of the Board of Directors of Credit Suisse, said: “In our Investment Banking Division, Eric Varvel and Gaël de Boissard have been instrumental in adapting our business to the new market and regulatory environment. Jim Amine and Tim O’Hara have also been integral to the success of the division, with our Investment Banking Department and Equities businesses demonstrating strong results and great momentum. I believe that the combination of Jim, Tim and Gaël will provide the right partnership to drive the business forward.”

Brady Dougan, CEO of Credit Suisse, said: “Eric Varvel has done a great job as CEO of Asia Pacific and I believe will provide important continuity of management and with client relationships in the Chairman role. Helman Sitohang has been instrumental in the success we have achieved to date. Moving into the CEO role is a natural progression and I believe he, along with the strong management team we have in the region, will be able to produce excellent results, demonstrate growth and build on the impressive momentum we have in Asia Pacific.”

Composition of the Executive Board as of October 17, 2014
− Brady W. Dougan, Chief Executive Officer
− James L. Amine, Head of Investment Banking – Investment Banking Department
− Gaël de Boissard, Head of Investment Banking – Fixed Income; Regional CEO of EMEA
− Romeo Cerutti, General Counsel
− David R. Mathers, Chief Financial Officer and Head of IT and Operations
− Hans-Ulrich Meister, Head of Private Banking & Wealth Management and Regional CEO of Switzerland
− Joachim Oechslin, Chief Risk Officer
− Timothy P. O’Hara, Head of Investment Banking – Equities
− Robert S. Shafir, Head of Private Banking & Wealth Management and Regional CEO of Americas
− Pamela A. Thomas-Graham, Chief Marketing and Talent Officer and Head of Private Banking & Wealth Management New Markets