. Standard Life Investments Expands Multi Asset Team
Standard Life Investments, the global fund manager, is pleased to announce that Gerry Fowler has been appointed as Investment Director, Idea Generation, within the Multi Asset Investment (MAI) Team.
Gerry, who was previously Global Head of Equity and Derivatives Strategy with BNP Paribas, will be part of the 57 strong team providing idea generation, investment recommendations and detailed implementation strategies for the range of MAI funds. Gerry will report directly to Guy Stern, Executive Director of Multi-Asset and Macro Investing at Standard Life Investments.
Commenting on the appointment, Guy Stern said: “Gerry is a highly skilled strategic analyst with a wealth of experience in equities and equity derivatives and will add to the already impressive range of knowledge and experience within the MAI team. Our Absolute Return and Multi Asset mandates draw on a range of sophisticated investment strategies investing across all asset classes. I’ve no doubt that Gerry’s depth of knowledge will add to our research capability and idea generation for our whole offering.
“Over the last 18 months we have launched four new Multi Asset products, the team is well resourced and we have excellent collaboration across all the fund management teams globally supporting the long term performance of our funds. We constantly strive to provide investors with the best possible solutions and that means having the right people in place to help understand and meet investor’s needs and expectations.”
CC-BY-SA-2.0, FlickrPhoto: Susanne Nilsson. Get Used to Periods of Higher Volatility
At the recent market peak, in late April, holders of 30-year German bunds were enjoying year-to-date returns of 23%. The dramatic reversal since then has entirely wiped out these gains: this is hardly the sort of behaviour one would expect from Europe’s premier ‘risk-free’ asset.
In our view, this phenomenon was caused by a crowd-surge into eurozone deflation/ quantitative easing (QE) trades and then a ‘rush for the exit’, when investors realised just how overpopulated and overvalued these trades had become. Overshooting markets do not always need a fundamental trigger to spark a reversal, but the rise in eurozone inflation in May, when core CPI rebounded to a 1-year high, certainly added some urgency to the unwind.
Morality check
We wonder whether today’s bund investors could learn some lessons from the Japanese government bond (JGB) market of the early 2000s. Having trended lower for more than a decade, 10-year JGBs troughed at 0.4% in June 2003. Even though Japan endured a grim eight-year decline in gross domestic product from that point, anyone who bought JGBs at the yield low in 2003 made just 1% per annum over those eight years and was in loss for the first four years of the trade. The moral of the story is: once economic stagnation is priced in, bond returns can be low and volatile, even if the economy continues to disappoint.
Furthermore, when we look at the eurozone today, we see an economy that is recovering, not stagnating. Consensus forecasts for 2015 growth have been rising for six months and inflation forecasts have been rising since February. Looking ahead, we expect more of the same as the impact of euro weakness, lower oil prices, easier credit conditions, and diminishing fiscal austerity kick in. Even though European Central Bank QE will continue to exert downward pressure on eurozone bond yields well into 2016, economic recovery is now emerging as a force that will act in the opposite direction.
Growing pains
Although bunds have seen the biggest swings this year, all the major government bond markets have followed the same pattern, with Q2 shaping up to be the worst quarter for sovereign bonds in almost 30 years. As is the case with eurozone bonds, the recent sell-off began as an unwinding of Q1’s euphoria, but more recently, has begun to reflect improving economic data, particularly in the US.
Following a disappointing start to 2015, US data have significantly improved over the last few weeks. A number of key series – retail sales, payrolls, job openings, consumer confidence, and homebuilder surveys – have surprised to the upside, suggesting the economy is regaining momentum and pulling away from Q1’s soft patch. We think this trend will continue in coming months, prompting the US Federal Reserve to raise interest rates before the year is through and keeping upwards pressure on US bond yields.
We see the recent sell-off in government bonds as largely correcting Q1’s overshoot. If our base case scenario of continued global recovery is realised, we do not expect to see Q1’s yield lows again during this cycle and think yields will grind higher in H2. Higher yields will not necessarily undermine risk assets if they reflect improving economic conditions. However, investors would do well to take note of Mario Draghi’s recent comment: “Get used to periods of higher volatility”.
Paul O’Connor is Co-Head of Multi Asset within the Henderson Multi-Asset team.
CC-BY-SA-2.0, FlickrPhoto: Giuseppe Milo
. Old Mutual Global Investors will Launch an Offshore Global Equity Income Fund
Old Mutual Global Investors announces its intention to launch the Old Mutual Global Equity Income Fund during the summer of 2015, subject to regulatory approval. The Fund, which will be managed by Ian Heslop, Amadeo Alentorn and Mike Servent will be a sub-fund of the Dublin domiciled Old Mutual Global Investors Series plc umbrella fund. This product will be core to Old Mutual Global Investors’ UK and offshore client base.
The Fund’s objective will be to achieve a total return through a combination of income and capital growth. The Fund will be designed to deliver a total return by targeting dividend yield and capital growth through a highly diversified global equity portfolio. The Fund will aim to provide monthly income above the benchmark (MSCI All Countries World Index). The investment team pursue a dynamic investment process, focused on stock selection through analysis of fundamental company data, but taking account of the macro environment and investor sentiment. The unique approach will generally provide significant diversification from concentrated, style-biased global equity income funds.
Ian Heslop, Head of Global Equities, comments: “We are really excited about the forthcoming launch of our Global Equity Income Fund. We believe that our unique approach to stock selection realises the appeal of being invested in a truly diversified fund. Unlike some of our peers who remain heavily weighted towards certain sectors, we are able to seek out compelling investment opportunities wherever these exist globally, irrespective of sector, country or region. We are also flexible so that the prevailing conditions and outlook can be incorporated in our process to ensure we have the greatest scope to deliver sustained outperformance. We believe our investment approach should therefore deliver an above industry level of monthly income whilst continuing to deliver capital growth”
The Fund benefits from the investment team’s strong, proven performance-driven culture which leverages a dynamic process, including continuous monitoring of the whole market in order to capture value across the broadest spectrum of larger-capitalisation stocks. The investment team will offer a significantly different source of alpha in global equity markets, run from the same platform as the multiple award winning Old Mutual Global Equity Fund, Old Mutual Global Equity Absolute Return Fund and the Old Mutual North American Equity Fund.
Warren Tonkinson, Head of Global Distribution, adds: “This is another important development for Old Mutual Global Investors, one that focuses on meeting the needs of our clients. From talking to investors it is very apparent that income generating strategies continue to be in demand and we have received a number of client requests for our highly respected, award-winning global equities team to launch a global equity income strategy. The investment performance track record this team, which consists of Ian, Amadeo and Mike, has delivered for investors in their current funds is outstanding. We are confident that the new fund will be equally successful.”
Old Mutual Global Investors is currently reviewing the UK Domiciled Old Mutual Global Equity Income Fund which is sub-advised by O’Shaughnessy Asset Management, LLC.
Sophie del Campo, Managing Director, Natixis Global AM, Iberia, Latin America and US Offshore. Courtesy photo. Natixis GAM Announces Completion of DNCA Finance Acquisition
Natixis Global Asset Management recently announced the completion of the acquisition of DNCA Finance (DNCA), expanding its list of global affiliates and strengthening its position in European retail markets
As an affiliate of Natixis Global Asset Management, DNCA, a well renowned European investment management company, will have access to Natixis Global Asset Management’s centralized global distribution capabilities. DNCA will immediately broaden its European footprint, entering new markets including Spain and expanding its business in Germany and Switzerland. DNCA will maintain its independence while over time expanding its global presence as an affiliate of Natixis Global Asset Management.
DNCA has seen important growth in the last 2 years, tripling its assets from €5 billion to €16.5 billion today. Through the acquisition, DNCA will maintain its independent management approach and will offer institutional and retail investors expertise in European equities, long only and absolute return, multi-asset, convertible bonds and euro-zone bonds.
“The combination of DNCA’s proven track record, solid investment performance, controlled risk profile and strong brand name will make a substantial contribution to the further expansion of Natixis Global Asset Management’s multi-affiliate model and our strategy of growing the business in the European retail marketplace,” said Pierre Servant, CEO of Natixis Global Asset Management and member of the senior management committee of Natixis in charge of Investment Solutions.
“As an affiliate of Natixis Global Asset Management we will be able to replicate the success that we have had in France and Italy over the past 15 years and step up our international expansion. We believe that Natixis’ centralized global distribution platform will help us develop our retail and institutional business and provide investors with a range of simple and understandable funds that deliver results that strengthen their portfolios,” said Eric Franc, CEO of DNCA Finance.
Place Vendome, Paris.. Carmignac Adds US-Oriented Global Expertise in Communications, Media, Internet and Information Technology
As part of the ongoing recruitment drive conducted over recent years, Carmignac is once again boosting its fund management team with the arrival of a senior fund manager, David Older.
David Older will work in London, commencing on July. Working alongside Edouard Carmignac, he will be in charge of global fund exposure to Communications, Media, Internet and Information Technology. David will also contribute to generating investment ideas for other Carmignac funds.
Edouard Carmignac, Founder of Carmignac : “Thanks to David Older joining our team alongside our analyst Tim Jaksland, we are significantly increasing our investment expertise in Communications, Media, Internet and Information Technology stocks, four key sectors in our current positioning that will shape tomorrow’s world. We are also gaining considerable experience in alpha generation and long-short management, which will help us generate performance under all market conditions and give us the complete range of risk management expertise.
The ability to manage market risks has become a hallmark of Carmignac’s management style, particularly in 2002, 2008 and 2011 in Carmignac Patrimoine. This risk management culture has gradually permeated all the Carmignac family of funds, becoming an integral part of our brand, henceforth Carmignac Risk Managers. The complexity of financial markets is such that managing risks, now more than ever, represents a vital aspect of long-term asset management, aimed at helping our clients grow their savings. Carmignac is relentlessly endeavouring to enhance its expertise in this area.”
David Older, 45 years old, spent the past 12 years at SAC Capital/Point72 Advisors in New York, most recently as co-Sector Head of the Communications, Media, Internet and Technology vertical. Prior to this, Mr Older was an Investment Banking Associate in the Communications and Media group at Morgan Stanley. He gained an MBA at Columbia University, New York, following a BA from McGill University in Montreal.
Claude Ewen. Courtesy Photo. Columbia Threadneedle Investments Appoints Sales Director in Luxembourg
Columbia Threadneedle Investments announces the appointment of Claude Ewen as Sales Director Luxembourg with immediate effect.
In his role, Claude will be responsible for broadening and deepening relations with Luxembourg-based professional investors. Claude will report to Prosper van Zanten, Country Head for the Benelux.
Claude has over 10 years’ experience in the Luxembourg financial market. He joins Columbia Threadneedle Investments from Fidelity Worldwide Investment where he had been senior sales manager since October 2009. Before that, Claude was portfolio manager for several years at Lux- Investment Advisors (now BCEE-Asset Management) where he contributed to the strategic and tactical asset allocation of UCITS funds and discretionary client portfolios and where he had responsibility for the analysis of the energy, commodities, industrial and utilities sectors. Claude started his career in 2000 at Banque et Caisse d’Epargne de l’Etat, Luxembourg as client relationship manager. He graduated from Louis Pasteur University of Strasbourg with a Master in Economics and Business Management.
Gary Collins, Head of Wholesale Distribution for EMEA and Latin America at Columbia Threadneedle Investments, said: “I am delighted to welcome Claude Ewen to our Benelux team. Claude has spent several years building and nurturing relationships with Luxembourg-based professional investors. We look forward to benefitting from his experience and insight as we grow and harness our presence in this market, significant both in its own right and as a central decision-making hub in Europe”.
. Allfunds Bank Hires Simon Shapland to Head UK & Ireland
Allfunds Bank has hired Simon Shapland to head its office for UK and Ireland. The company is Europe’s largest mutual fund platform with over €200 billion (£142Bn) under administration and has recently recognised by asset managers for having the best potential to support their distribution strategies.
Simon Shapland was until recently, the Managing Director for the UK & Middle East of RBC Investor and Treasury Services. He has significant experience in international sales as well as general management and strategy expertise and he has a demonstrable record of accomplishment of delivering revenue growth across a diverse and complex client base spanning multiple geographic locations. He has board level experience gained from membership of senior executive committees.
After a decade at RBC and RBC Dexia Investor Services, where he undertook a number of senior roles, Shapland took responsibility for the company’s UK branch overseeing some 350 staff and managing strategic relationship management in the day-to-day account management function.
At Allfunds Bank, Simon Shapland will report to Gianluca Renzini, Allfunds bank’s Deputy General Manager and he will lead the London office that today administers over £15 billion of assets. This announcement ratifies the consolidation of the UK operation, which is becoming a key business engine of the platform’s great performance.
Gianluca Renzini, Allfunds Bank’s Deputy General Manager, said:“Simon Shapland has significant experience in funds administration and is very well-placed to take forward our UK business to the next stage. We continue to believe our UK and Irish business will be one of the main drivers of growth of Allfunds Bank over the coming decade”.
Javier San Félix, new Head of the Retail Bank in Santander UK / Photo: www.santander.com. Javier San Félix Appointed Head of the Retail Bank in Santander UK
Banco Santander’s Board today approved a series of management and organisational changes which further simplify the Group’s corporate structure and enhance its internal governance: in the Board of Directors, Ignacio Benjumea, General Secretary and Secretary of the Board, will leave his executive role and will become an external Board Director. Juan Rodriguez Inciarte, has resigned from the Board for personal reasons and will leave his role as Senior Executive Vice-President in December this year.
In the Senior Management space, Jaime Pérez Renovales, Senior Executive Vice-President, has been appointed General Secretary and Secretary of the Board effective September 1st. He will lead the newly-created Division of General Secretariat and Human Resources, which will integrate the areas of Legal and Tax and all the areas which were under the former division of Human Resources, Organisation and Costs. Pérez Renovales is a highly accomplished professional who is returning to the Group following a period of 3.5 years in the public sector. Jesús Cepeda, Senior Executive Vice-President and until now Head of Human Resources, Organisation and Costs, will leave his role on September 1st.
Rami Aboukhair, Senior Executive Vice-President of the bank with extensive expertise in retail banking in Spain and the UK, has been appointed country head for Santander Spain, replacing Enrique García Candelas, who will become Vice Chairman of Santander Totta (Portugal) following his great work in Spain.
Javier San Félix has been appointed Head of the Retail Bank in Santander UK, reporting to Nathan Bostock, CEO of Santander UK. Ángel Rivera, Senior Executive Vice-President, has been appointed Head of the Retail and Commercial Banking Division.
In the last few weeks, the following Senior Executive Vice Presidents have also resigned from their roles: Remigio Iglesias (Head of Recoveries); Juan Andrés Yanes who will be replaced as Head of Strategic Alliances by Juan Manuel San Román; Luis Moreno (Head of Private Banking); and José María Espí (Director of Internal Control and Risk Assessment).
The Board of Directors, Santander Spain
Two years ago all the Group’s businesses serving customers in Spain were consolidated under Santander Spain to establish a clear separation between the functions of this unit and the corporate center. Today they are announcing a further step in the process of strengthening Santander Spain by creating a Board to oversee it. This will bring its governance structure in line with the Group model which exists in other country subsidiaries. This Board will monitor and supervise the activities of Santander Spain, including its policies and strategies, risk, human resources and senior management appointments as well as a number of control and monitoring tasks.
The Board of Directors of Banco Santander has appointed Rodrigo Echenique, Vice Chairman of the bank, in the additional role as Chairman of the Board of Santander Spain. The Board of Santander Spain will have at least one third independent directors with the Country Head of Spain (Rami Aboukhair) as a permanent member. The Group has also appointed to the Board of Santander Spain, Ignacio Benjumea, Angel Rivera (Head of the Retail and Commercial Bank Division), José María Nus (Chief Risk Officer), José García Cantera (CFO), Carlos Barrabés, Javier Monzón and Gonzalo Alonso-Tejuca, the last three of whom are independent directors.
According to the bank, the new corporate structure will facilitate work and increase both competitiveness and focus on adding value to the Group’s core local country businesses; and the number of divisions has been reduced from 15 to 10 in the last six months and with today’s changes the number of senior executive vice-presidents is reduced by 7 (or 23%). “We are enhancing the Group’s internal governance with the creation of a board for Santander Spain”. Ana Botín, Santander’s Group Executive Chairman, said: “These changes complete the management team which José Antonio Álvarez and I began restructuring in 2014. To achieve our vision to be the best retail and commercial bank for our people and customers, and to continue to generate sustainable growth we must simplify and make our organisation more competitive”.
“Our goal in making these changes is to have the best qualified professionals in the right roles and progress towards becoming a bank that is Simple Personal and Fair for our people, customers, shareholders and communities”, Ana Botín said.
Josep Oliu, Chairman of Sabadell. UK Authorities Give Green Light to Acquisition of TSB by Sabadell Group
The UK authorities (PRA and FCA) have approved the bid by the Sabadell Group, announced on 17 April 2015, to acquire all of the shares of TSB Banking Group plc which is based in Britain.
With this acquisition, the Sabadell Group is taking a leap forward in its strategy of expanding into other countries, which is one of the pillars of its Triple strategic plan for 2014-2016 (Transformation, Profitability and Internationalization). After the TSB acquisition, 22% of Sabadell’s assets will be located outside Spain, compared with 5% at present.
Josep Oliu, Chairman of Sabadell, says: “Today marks the beginning of a major project. This is a milestone that enables us to enter a market with vast opportunities. We do so in partnership with a well-positioned challenger bank with a prestigious brand backed by a long tradition.
“Furthermore, TSB has a highly professional management team which is successfully delivering its business plan and which is committed to growing TSB further still as part of the Sabadell Group. TSB will enable us to increase our international footprint and diversify our business activities. It’s a major opportunity.”
Paul Pester, CEO of TSB, says: “The deal with the Sabadell Group is a major vote of confidence in TSB. With the extra firepower and fresh perspective of Sabadell, TSB will be stronger and even better placed to build on its position as Britain’s challenger bank. Being part of the Sabadell Group will help TSB bring more competition to the UK market more quickly and help us break the stranglehold the ‘Big Five’ banks have had for far too long.
“TSB and Sabadell have similar values. Both have heritages that date back to the nineteenth century and proud histories of focusing on and supporting hard working local people and businesses.”
The experience accumulated by the Sabadell Group in integrating numerous successful bank acquisitions to date and its extensive knowledge of customer service, particularly in personal and SME banking, will play a key role in generating value in this new phase.
The deal, worth 1.7 billion pounds (2.35 billion euros), to be paid for entirely in cash has a neutral impact on the Sabadell Group’s CET1 ratio. Sabadell believes that Lloyds Banking Group’s contribution of up to 450 million pounds (about 622 million euro) is expected to be more than sufficient to meet the implementation costs of the IT migration onto Sabadell’s platform.
Further, the Group estimates technology synergies of approximately 160 million pounds before taxes (about 221 million euro) in the third full year after completion of the Offer.
. T. Rowe Price Expands Relationship Management Team for Spain and Portugal
T. Rowe Price, the $772.7bn global independent asset manager, has appointed Pedro Masoliver to its client management team in Spain. He will report to Alfonso del Moral the Headof Relationship Management for Spain and Portugal in support of the firm’s drive to increase its share of the intermediary markets in Europe.
Mr. Masoliver joins T. Rowe Price from GBS Finanzas, a multi-family office where he was an Analyst. Prior to that, he was a Senior Fund Analyst at Allfunds Bank, investing consultant department between 2007 and 2012. This new role will see him focus on relationship management for clients in Spain and Portugal as well as supporting the sales drive in both countries.
Alfonso Del Moral, Head of Relationship Management for Spain and Portugal said “Pedro Masoliver is a great addition to the team we are building to support our growth. The experience he brings from the sell-side and as an Analyst will add to our ability to anticipated and service the needs of our clients. I look forward to working closely with him as we develop our business in Spain and Portugal.”
