Saudi Arabia – Shifting Sands

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Saudi Arabia – Shifting Sands
Foto: Nepenthes. Arabia Saudita – Arenas de cambio

Tom Nelson, portfolio manager for the Global Energy Equity strategy at Investec AM, took a research trip took to Oman, Dubai, Abu Dhabi and Saudi Arabia last March comprising fifteen company meetings and four visits to production facilities. His main goal was to learn more about the reservoir performance and supply outlook in the world’s dominant petroleum province, as well as the social and political climate within the region. Some of the notes of his journey follow:

“In this note I intend to focus on Saudi Arabia, as the major OPEC oil producer (9.5 million barrels/day), but also as a country undergoing profound socio-economic change.

The Kingdom of Saudi Arabia has the 20th largest economy in the world by GDP, larger than South Africa or Taiwan, making it by far the biggest economy in the MENA region (excluding Turkey). It has the largest proven oil reserves of any country (260 billion barrels), and is rightly considered the central bank of crude oil, as the only producing country with significant (1 million barrels/day+) spare capacity. Saudi Aramco is by my calculations the most profitable enterprise on the planet: 9.5 million barrels/day of production of crude oil, which trades for $100 and costs them $4-8 to extract. This translates into $350 billion revenue per year, with a 90%+ profit margin. Not surprisingly, the Saudi Arabian Monetary Authority (SAMA) has $550-600 billion in net foreign assets, making it the fourth largest sovereign wealth fund. These numbers will be familiar to many readers, who associate the Kingdom most immediately with oil wealth.

More striking is the social and demographic picture: 28 million people living in the 13th largest country in the world. 51% of the population are under the age of 25, and there is a 30% unemployment rate in the 20-25 year old bracket. The exciting perspective of Saudi Arabia is not the legacy wealth under the desert, but the implications for the young population living above it.

Local employment targets have been ratcheted significantly higher since the Arab Spring – not just in Saudi Arabia but across the region – and this was clear from all of our meetings with major Western oil companies. BP, Total, Occidental, Schlumberger, and Halliburton all talked about elevated targets for local employment and training. The most striking comment came from Schlumberger’s country manager for Saudi Arabia, a Lebanese national trained in 12 countries and 4 continents over a 28-year career at Schlumberger (including a Mechanical Engineering degree, an MBA at Insead, and a year at MIT). He assured us that Schlumberger in Saudi Arabia would soon be 60% staffed by local people and that in the event of turmoil in the Kingdom and an exodus of expats the company could continue to function effectively. Similarly, Occidental Petroleum in Oman is now the country’s third largest employer, with 82% of employees being Omani nationals.

I found myself rapidly becoming optimistic for the future of this young, primarily urban population as the extensive social program became clear. Increased diversification away from the core oil wealth (still 80% of budget revenues and 90% of export earnings) into banking, construction, and chemicals, should be facilitated by a huge free education program, unlimited free healthcare, and rising infrastructure spending.

Naturally, challenges persist: labor productivity ranks towards the bottom of the range, with the Arab Labor Organization estimating worker productivity in Saudi Arabia to be only 17% of the US industrial worker. Women have only been empowered to vote since 2011, and make up only 15% of the workforce. And despite the build- out of new roads, the safety on them is very poor. By deaths per 100,000 of population it is the most dangerous country in the world for drivers.”

Interested in Saudi Arabia? You can read the full report through this link.

Chris Edge Appointed to Head Allfunds Bank’s Business in Luxembourg

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Chris Edge Appointed to Head Allfunds Bank's Business in Luxembourg
Chris Edge liderará el negocio en el Ducado para impulsar el crecimiento internacional de la entidad. Allfunds elige a Chris Edge para dirigir su negocio en Luxemburgo e impulsar su expansión internacional

Allfunds Bank has appointed former JP Morgan Luxembourg managing director Chris Edge to head its business in the Grand Duchy to help drive the firm’s international expansion.

Chris is a highly respected and well-known industry figure in the European Investment Fund sector and has a wealth of experience in running a regulated bank in Luxembourg and in growing businesses. He is a twenty-year veteran of JP Morgan, covering a wide variety of senior roles for the bank across the UK, South Africa and Luxembourg during two stints, in between which he built a financial service distribution business in the UK and a mobile transactions business in East Africa.

Allfunds Bank’s Chief Executive Juan Alcaraz, said: “I am delighted to welcome Chris to Allfunds at a time when we are extending our European operations. We are strongly committed with Luxembourg, as one of the most important financial centre at the heart of Europe, is a natural and logical evolution as Allfunds becomes ever more successful in following and supporting our clients and providers in their international expansion.

Chris said: “I am really excited to have this opportunity to build upon my long career in European Investment Funds and apply that experience in a major fund distribution business. Regulatory change and advisor remuneration rules are creating the catalyst to transform channels and investor access over the next decade and Allfunds is very well positioned to support its clients through this transformation. I look forward to ensuring the investment in the Luxembourg hub will realize the growth potential this offers to Allfunds and its clients and partners”.

Allfunds Bank is a leading European Mutual Fund platform aimed exclusively towards institutional clients, offering integrated fund solutions (operational, analysis and information). Created in 2000 and owned in equal parts by the Santander and Intesa Sanpaolo groups, today Allfunds Bank has more than €121bn assets under administration and offers close to 40,000 funds from 450 fund managers. Allfunds Bank has a local presence in Spain, Italy, UK, Chile, UAE, Switzerland and Luxembourg and has more than 400 institutional clients, including major commercial banks, private banks, insurance companies, fund managers, financial supermarkets, international brokers, and specialist firms from 28 different countries.

ING IM Research Reveals Strong Appetite for Senior Bank Loans from Institutional Investors

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Acceder a todos los universos: inversiones multiestrategia
Foto: Markchdwickart, Flickr, Creative Commons.. Acceder a todos los universos: inversiones multiestrategia

New research from ING Investment Management (ING IM) amongst pension funds reveals that 42% believe institutional investors have increased their exposure to senior bank loans over the past six months, whilst only 2% felt it had fallen. Indeed, ING IM is announcing that it has seen assets under management in its senior bank loan strategies increase by 46% over the past 12 months, from $13 billion to $19 billion.

Growing demand for this asset class is expected to continue as the research reveals that four out of ten (40%) pension funds expect institutional investors to increase their exposure over the next 12 months, compared to 8% who think it will fall ‘slightly’.

Senior bank loans are extensions of credit made to non-investment grade corporations. They are private issues traded directly among banks and institutional investors in a private secondary market and not on a public exchange. They are generally secured by a borrower’s assets pursuant to a first priority or “senior” lien, and they are first in priority in receiving payments when a borrower is servicing its debts. They can also be called “floating rate loans” because the interest paid on such loans changes as certain market interest rates change.

The interest rate reset period varies from loan to loan, but a large, diversified portfolio of senior loans can be expected to have a weighted average interest rate reset period of 60 days or less. As a result, the income earned from a senior loan portfolio is generally very responsive to changes in short-term interest rates. Because the price of senior loans is less sensitive to market interest rates than bonds, they provide a high degree of diversification to a fixed income portfolio. The asset class saw huge inflows in 2013 because of its strong performance – they currently provide typical yields of up to 5% – in a difficult market. ING IM’s Senior Loans strategy portfolio has delivered an annualised return of 5.28% over the past three years (0.47% above the S&P/LSTA Leveraged Loan Index Hedged to Euro).

When asked what the main benefit of investing in senior bank loans is, 29% of pension funds said diversification of a fixed income portfolio, followed by 19% who said attractive risk adjusted returns. One in seven (14%) said it was because the default risk is low.

Most attractive benefit of investing in Senior Bank Loans

Percentage of pension funds who think this

Diversification of fixed income portfolio

29%

Attractive risk adjusted returns

19%

Default risk is low

14%

Protection against a rise in interest rates

10%

Correlation  with other asset classes is comparatively low

3%

Transparent and easy to analyse performance

2%

Secured by collateral

2%

Don’t know

21%

Dan Norman, Managing Director and Group Head of ING IM’s Senior Bank Loan’s team said: “In today’s environment, investors are on the hunt for attractive sources of yield. Senior bank loans offer an excellent balance of income and security, and these characteristics have fuelled strong demand for this asset class over the last couple of years. We believe that this will continue. The potential for the fund management industry here is strong because there are still institutional investors who want and need a better understanding of the benefits of senior loans and what they offer to a diversified fixed income portfolio.”

Startup Investing Using Bitcoin Now Possible on Startup Stock Exchange

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Gestionando con el nuevo oro de la inversión: ¿criptodivisas?
Foto: Copley, Flickr, Creative Commons. Gestionando con el nuevo oro de la inversión: ¿criptodivisas?

The Startup Stock Exchange (SSX), a regulated global marketplace for startup investing and funding, has become the first investment platform to allow investors of any size to purchase publicly trading shares in Startups using Bitcoins.

Owners of Bitcoins can fund their SSX Investor Account using the GoCoin payment processor and then buy shares in Startups offered through the Startup Stock Exchange. Recent investment opportunities include a Latin American online insurance company, an ecommerce site for beauty products, and the NXTP Labs portfolio of companies.

“SSX provides investors of all levels access to investment opportunities in global Startups. The addition of Bitcoin as a funding method makes it easier for these investors to participate on our global market and invest in our public Startups,” said Ian Haet, CEO and Co‐Founder of the Startup Stock Exchange. “Starting today investors can take their Bitcoins, convert them to US Dollars, fund their Trading Account and invest in the listed Startups, all on the SSX website.”

Funding by Bitcoin was adopted due to the crypto‐currency’s tremendous growth and international interest. SSX is focused on global Startup investments and adding Bitcoin as a funding option supports SSX’s mission. SSX has clients in over 100 countries and Bitcoin provides a secure and cost effective mechanism for transferring funds internationally, including countries such as Argentina, Singapore, Venezuela, South Africa and Morocco.

“We are thrilled that the Startup Stock Exchange has selected GoCoin as their solution for accepting digital currency. It further validates that disruptive technologies like Bitcoin and crypto‐currency is reverberating more and more with corporations, small businesses and consumers” said Steve Beauregard, Founder and CEO at GoCoin.

All Bitcoin transfers completed by SSX Investors are reviewed according to strict Anti‐Money Laundering (AML/CTF) procedures. As a regulated global marketplace for Startup investing and funding, this review process is an important factor in adhering to global best practices regarding the prevention of Money Laundering and maintaining the security of investing via SSX.

Oppenheimer Europe Opens a Branch Office in Geneva, Switzerland

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Oppenheimer desembarca en Ginebra para centrarse en las ventas institucionales en Europa
Emmanuel Geiser, managing director and branch manager at Oppenheimer in Geneva. . Oppenheimer Europe Opens a Branch Office in Geneva, Switzerland

Oppenheimer Europe Ltd., a subsidiary of Oppenheimer Holdings Inc., a financial entity offering global investment banking services has opened a new office in Geneva as part of the firm’s continued international expansion. The Geneva office will be led by Emmanuel Geiser, who, along with a team of seasoned professionals, has a long and established track record serving institutional clients in Switzerland, France and Benelux markets.

The new office, which will focus on Institutional Sales across Europe, will strengthen Oppenheimer Europe’s institutional client coverage, access to middle market clients across Continental Europe, and ability to place securities into European institutional buyers. This will be the Firm’s second European office in addition to its London headquarters. In March 2012, Oppenheimer Europe opened an office in Jersey, Channel Islands.

Max Lami, Chief Executive Officer of Oppenheimer Europe, said: “Despite difficult market conditions the Company has performed exceptionally well and our expansion into Switzerland offers a tremendous opportunity for us to continue to build our presence in the European market. While many other firms are scaling back, we believe now is the time to grow.”

Emmanuel Geiser joins Oppenheimer Europe as a Managing Director and Branch Manager from National Bank of Canada, where he was the General Manager of their Swiss subsidiary, NBF International SA. Emmanuel worked for National Bank of Canada for 23 years.

Julie Chirouze joins Oppenheimer Europe as an Executive Director from National Bank of Canada, where she was a Vice President of Institutional Sales.

Florian Parvulesco joins Oppenheimer Europe as an Executive Director from National Bank of Canada, where he was a Director of Institutional Sales for 13 years.

Luisa Puglia Giongo joins Oppenheimer Europe as an Executive Director from National Bank of Canada, where she was Middle Office Manager.

Philippa Parisi, Co-Head of Institutional Equities in Europe commented: “Emmanuel and the team have an incredible network of relationships across institutional clients in Europe, both in the tier 1 and middle market segments, and will be a terrific complement to our Firm.”

John Hellier, Head of Global Equities at Oppenheimer & Co. Inc., added: “We are very pleased to have Emmanuel, Julie, Florian and Luisa join the Oppenheimer platform in Europe. Our already strong presence in Europe is significantly bolstered by this capability to service the needs of institutional clients throughout Switzerland, France and the Benelux countries.”

“We see competitors scaling back in Europe, including those that have been very successful in the past, so what we are doing may be seen as standing apart and moving in a different direction. Larger international banks do have a similar global footprint to us, but they really only mobilise that infrastructure and resource for the very largest institutional clients,” added Max Lami.

 

GenSpring Continues National Growth with Additions and Promotion in South Region

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GenSpring Continues National Growth with Additions and Promotion in South Region
Foto: Affisch. GenSpring sigue creciendo en EE.UU. con nuevas contrataciones en la región sur

GenSpring Family Offices, a leading wealth management firm for ultra-high net worth families, is pleased to announce the addition of two Managing Directors of Client Development in the firm’s South Region. John Frazer joins GenSpring to lead client development efforts in Georgia, Tennessee, and the Carolinas. Dale Sands joins to lead client development efforts focused on business owners and executives.

These key additions follow recent announcements GenSpring has made of expansions in the firm’s Western Region, with a family office establishment in Los Angeles and a significant expansion in San Francisco.

In addition, GenSpring has named Chris Trokey as Managing Director of Client Service for the South Region. Trokey, a 10-year GenSpring veteran who previously served as Family Investment Officer, leads a team of more than 30 family office professionals and is responsible for overseeing all aspects of the client experience across the firm’s Atlanta, Charlotte and Nashville family offices.

“I am thrilled to promote Chris to lead our client service efforts in the South Region,” said Chief Executive Officer Thomas M. Carroll. “Over the last 10 years, he has contributed greatly to our firm and to the lives of the families that he advises. Chris’ leadership coupled with the experience and insight of John and Dale give me great confidence that we will continue to deliver on our purpose of sustaining and enhancing family wealth and helping to ensure it has a positive impact on those who receive it.”

Mr. Frazer brings extensive wealth management experience to his new position at GenSpring. Prior to joining the firm, he spent 25 years with SunTrust Bank, most recently as Executive Vice President, Private Wealth Management Division for all of Georgia and North Florida. During his tenure, Mr. Frazer served as President and Chief Executive Officer of SunTrust Bank, Memphis Region and as Executive Vice President and head of the Memphis Region’s Private Wealth Management Line of Business. He is a graduate of The Citadel and The Graduate School of Banking of the South at Louisiana State University.

Mr. Sands, an Atlanta native, joins GenSpring with more than 17 years of Investment Banking experience specializing in advising ultra-high net worth families, young entrepreneurs, closely-held businesses and corporations in a variety of corporate finance capacities. In this new role, he will work in close partnership with SunTrust Robinson Humphrey, the full service corporate and investment banking arm of SunTrust Banks, Inc. with more than 1000 public and private clients across the country ranging from emerging growth companies to the Fortune 500. Mr. Sands, who started his career with Salmon Smith Barney in New York, has advised clients on numerous public equity, private equity, merger and acquisition and corporate divestiture transactions totaling billions of dollars. Most recently, Mr. Sands served as a senior member of SunTrust Robinson Humphrey’s Merger and Acquisition Group. He holds an MBA from the University of North Carolina, Chapel Hill, and an undergraduate degree from Vanderbilt University.

Mr. Trokey joined GenSpring in 2004 as a Family Investment Officer in the Atlanta family office. Previously, he served as vice president of Tower Hill LLC. He also served in the Private Wealth Management division of Goldman, Sachs & Co., and began his career at KPMG LLP where he managed audit and consulting service teams. Mr. Trokey earned a Bachelor of Science degree in Accounting from Indiana University and a Masters of Business Administration in Finance from Washington University in St. Louis. He is a Chartered Financial Analyst, holds the Chartered Alternative Investment Analyst designation, and has also passed the Certified Public Accountancy examination.

Asset Growth vs Alpha Generation: the Capacity Management Conundrum

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Crecimiento de activos vs generación de alfa: el dilema de la gestión de capacidad
Wikimedia CommonsPhoto: Rabensteiner - Bearbeitet von Rainer Z. Asset Growth vs Alpha Generation: the Capacity Management Conundrum

Success in asset management leads to a well-known conundrum: how to best manage increases in assets under management (AUM) while continuing to generate value-added alpha for clients.

A growth in AUM may make it more difficult to implement a strategy by imposing certain costs and impediments, such as liquidity constraints, potentially higher transaction costs and client-servicing requirements, as well as the need to ensure adherence to the strategy. Business diversification across multiple strategies and investment teams is another important consideration when evaluating the capacity of individual investment strategies. According to a new research published by MFS, this is key to ensuring a sustainable business model, which in turn impacts individual product performance.

Capacity can be managed in various ways, including with the implementation of product closures, which are designed to protect the interests of existing clients by limiting further inflows. In this case, MFS refers to both clients in the strategy of interest as well as clients more broadly in strategies that may overlap with the product in question. Preserving alpha-generating capability for existing clients is paramount in their view, and is at the heart of capacity management. It is in this context that capacity management is viewed as an integral component of risk management at MFS.

While there is general agreement among asset managers and their clients that products need to be closed for capacity reasons, there is little consensus on how capacity should be measured. Various academic and industry studies have offered a number of quantitative tools to help determine product capacity; however, these approaches are sensitive to the underlying assumptions made and none is definitive. Not only is capacity hard to measure, it is also a function of current market conditions and the characteristics of a given strategy.

Certain asset classes are inherently more capacity constrained than others. Portfolios invested in large-cap US equities have significantly more capacity than portfolios invested in either small-cap or emerging market equities. Highly concentrated portfolios (e.g., 20-stock portfolios) generally have less capacity than more diversified portfolios, depending on the liquidity of stocks included in the portfolio. Portfolios with high turnover require greater market liquidity and therefore have less capacity than portfolios with lower turnover that can patiently trade over longer holding periods. According to the whitepaper, one should bear in mind that all these parameters interact with one another and market conditions change over time, so portfolio characteristics must be fully examined before applying generalizations about capacity.

In this white paper, MFS outlines its approach to managing capacity in equity portfolios in some detail to illustrate the firm’s philosophy and considered methodology. They also provide information on the product restriction decisions made with regards to the Global Equity strategy as a case study. The way capacity is considered from a fixed-income portfolio perspective is also addressed.

BNY Mellon Appoints Ryland Pruett Dreyfus National Sales Manager

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BNY Mellon Investment Management announced today that Ryland Pruett has been named national sales manager for The Dreyfus Corporation and its mutual fund complex, with responsibility for leading the sales effort through broker dealers. Ryland brings over 22 years of field sales and leadership experience to the Dreyfus organization and is charged with building out the newly expanded sales force and to create efficiencies in total distribution.

In this newly created position, Pruett reports to Andrew Provencher, BNY Mellon executive vice president and head of U.S. retail sales. 

“Ryland has a strong track record in building momentum for mutual fund strategies through broker dealers,” said Provencher. “He has led programs that significantly grew fund sales while diversifying distribution channels and products.  He also has demonstrated an ability to identify new business opportunities and take advantage of them.” 

Provencher added, “Ryland has an acute sense for driving better client interactions and promoting sales efficiencies through the extensive use of data, customer segmentation, predictive analytics, and other ‘intelligent distribution’ tools and techniques.”

Pruett joins BNY Mellon from Neuberger Berman, where he was national sales manager for the wire house channel. While at Neuberger, he played a key role in building the sales force through two major expansions as well as raising and diversifying revenues within broker dealer distribution.  Prior to joining Neuberger Berman, he held field sales and leadership roles at Invesco.

Pruett received his bachelor’s degree in finance from Georgia State University.

Brazilian Investors Beginning to Whet their Appetites for Diversifying Abroad

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Al inversor brasileño se le empieza a abrir el apetito por diversificar en el exterior
Wikimedia CommonsErnesto Leme, the partner responsible for Claritas Investments’ Wealth Management division.. Brazilian Investors Beginning to Whet their Appetites for Diversifying Abroad

This year marks Claritas’ fifteenth anniversary in Brazil. What started as a hedge fund firm, evolved into one of Brazil’s pioneer independent management companies, as well as becoming one of the pioneers of the country’s alternative industry; a path which the company has consolidated into a multi strategy approach offering multi-asset products, long/short and equity funds. In 2001, two years after its founding, the firm launched its equity strategy to then leap into the fund of funds industry in 2004, and then in 2007 as asset managers in private equity. It was in 2008 when the company embarked onto the development of the wealth management business, and in 2012 joined Principal, as was explained to Fund Society by Ernesto Leme, the partner responsible for Claritas Investments’ Wealth Management division.

As regards Claritas Wealth Management, Leme explained that the company mainly targets the ultra-high-net-worth (UHNW) Brazilian clients. In order to protect and grow these clients’ wealth, the best approach is to offer diversification, remembering that “we are not here to make them rich. Our job is to keep them rich for generations, but not make them rich,” he added.

International diversification is not a strong trend in Brazilian investors, as safeguarded as they are by the country’s extremely high interest rates and its stability derived from a consistent growth in recent years, they have not leaped into exterior markets. However, Leme has found that in the last 12 months an appetite for international diversification has developed, and it is aimed primarily at the U.S. and Europe. “Diversification is no longer exclusively targeted towards emerging markets, although there is still interest in some countries within the region such as Chile, Peru and Mexico, it is no longer concentrated only in those markets,” he added.

As for the asset class trend among Claritas clients, Leme said that the investor currently tends more toward equities, followed by fixed income, where there is also substantial interest.

The executive explained that, in response to the Brazilian investor’s growing appetite for international diversification, the firm has recently launched three strategies: a global equities fund, with  60% positioning in the United States, and which is also its first global shares’ fund, a high yield American fund, and a preferred securities fund, which invests in large international companies such as banks, insurance and reinsurance companies, telecommunications, energy and transportation, among others. The team of this last fund is in the United States and consists of 14 people. These new products are made in Brazil, but they have all been allowed to invest abroad. The three funds are: Claritas Global Equity, Claritas Preferred Securities and Claritas Global High Yield.

Finally, when asked about his participation in the upcoming Private Wealth Brazil Forum, to be held in Brazil next May 13 th, Leme, who will participate in the panel discussion on current trends and expected returns in the hedge fund space, said his commitment to hedge funds was placed in the macro space because the achievements are measured independently of traditional markets.

Private Wealth Brazil Forum, organized by Latin Markets, is a meeting point for private bankers, UHNWI, asset managers, family businesses and family offices. The forum brings together more than 300 professionals and industry leaders of Brazilian wealth management for a day of lectures, in which strategies to protect, preserve and grow wealth are addressed.

RBC Wealth Management Closes Down in Chile after Six Years in the Market

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RBC Wealth Management echa el cierre en Chile después de seis años en la plaza
Photo: Henrickson . RBC Wealth Management Closes Down in Chile after Six Years in the Market

RBC Wealth Management has decided to close down its office in Santiago de Chile after six years in the country “as part of a strategic review of our business in Latin America.” As RBC Wealth Management confirmed to Funds Society, the closure will take place later this year.

Similarly, RBC Wealth Management pointed out during a brief statement that “more than 95% of our Latin American customers are now served through our highly experienced offices in the Caribbean, Europe and North America. We will continue to grow through this successful business model.” Richard Diego is at the helm of RBC Wealth Management business for Latin America.

The Chilean newspaper “Pulso” was the first to report the news, informing that RBC WM clients in Chile have already begun to be notified of the office closure via email.

RBC Wealth Management arrived in Santiago in early April 2008, setting up office in Nueva Las Condes, the financial heart of the Chilean capital. At that time, RBC’s objective for Chile was to provide financial advisory services with a global vision for high net worth individuals (HNWIs), which as the firm explained at the time, was an activity which supplemented “the strong presence in Latin America through the continued expansion of the company in the region.”A week earlier, RBC WM also opened offices in Mexico.

This is not the first time the Wealth Management division of the Canadian bank steps down in Latin America. In August 2013, the company announced the closure of its offices in Uruguay, also appealing to reasons of business strategy in the region. As is happening in Chile now, Uruguayan customers were also offered to move their funds to the bank’s other offices in Europe or North America.

Two months prior to RBC notifying its departure from Uruguay, its premises were raided by Argentine Judge Norberto Oyarbide, amid an enquiry into alleged tax crimes for a “Mega Cause” investigation into asset laundering maneuvers through million dollar transfers of dozens of football players. At the time, however, RBC denied that this fact was related to the closure of its business in the country.