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Ana Patricia Botín: “My Ambition Is to Continue This Success Story, to Which I Will Dedicate My Greatest Efforts”

Ana Patricia Botín reconoce que "no será fácil" continuar con la trayectoria de éxito de las últimas décadas — Ana Botín, executive chairman of Banco Santander, had “a very special tribute to the memory of Emilio Botín" at the Extraordinary Shareholders' General Meeting last Monday. Courtesy photo.. Ana Patricia Botín: “My Ambition Is to Continue This Success Story, to Which I Will Dedicate My Greatest Efforts”

The extraordinary shareholders’ general meeting of Banco Santander approved on Monday the proposal from the board of directors to increase share capital for the acquisition of all Banco Santander Brazil shares not held by Grupo Santander, representing 24.75% of its share capital. The transaction, announced on April 29, will be paid for in Banco Santander shares, with those of Banco Santander Brazil valued at the market price on the day prior to the announcement of the offer plus a 20% premium.

The offer is voluntary and is not subject to a minimum level of acceptance. In the event that all Santander Brazil shares held by minority shareholders respond to the offer, Banco Santander shares equivalent to 5.62% of the bank’s share capital would be issued. Santander Brazil shares will continue to be listed on the Sao Paulo stock market, and a request will be made to list the shares of Banco Santander as well.

The executive chairman of Banco Santander, Ana Botín, began her speech to shareholders with a tribute to the former chairman, Emilio Botín, after his death. “In almost thirty years as the chairman of the bank, he made Santander the number one bank in the eurozone, and one of the top ten banks worldwide in market capitalization. His achievements came from a clear vision: prudent risk-taking, focus on the client and on commercial banking, and agility so as to move forward and take advantage of opportunities for growth. Today, thanks to his vision, Santander is not only larger, but more diversified and more solid, as shown by its resilience throughout the financial crisis, being one of only three large international financial institutions to go through the crisis without incurring losses during even a single quarter.”

She also underlined that “his support for initiatives in education and culture has also been outstanding, with Santander’s commitment to academia and to society making it a benchmark institution both in Spain and in all the markets in which Santander operates. Looking to the future, we will follow the same strategy and work to further strengthen the Santander culture, which is the basis for sustainable growth. It is a culture focused on commercial banking, on being close to our clients and offering them the best service, and on seeking to contribute to social and economic progress. My ambition is to continue this success story, to which I will dedicate my greatest efforts.”

The executive chairman of Banco Santander went on to review the details of the acquisition offer for shares in the Santander Brazil subsidiary that are held by minority shareholders. “This transaction demonstrates the group’s confidence in Brazil and in Banco Santander Brasil. Brazil is a tremendous country, with strong potential for growth. It also has solid institutions, a quality business sector, and a well-managed and supervised financial system. All of this gives us confidence in the attractiveness of the Brazilian economy, and that the country will overcome the economic slowdown it is experiencing at this time.” She also highlighted the group’s confidence in “the capacity of Banco Santander Brazil to bolster its results – which today represent 20% of the group’s attributable profit – providing an appropriate return on our investment.”

Ana Botín gave a reminder that “this transaction is financially beneficial both for the shareholders of Santander Brazil and for those of Banco Santander.” For the former, because they will receive a 20% premium, but also because the offer is made up of Santander shares. “This will allow those accepting the offer to continue to benefit from the advantages of the group’s investment in Brazil as well as sharing in the strength and diversification of Banco Santander.”

It is also positive for Banco Santander shareholders, “as it will entail a 1.3% increase in earnings per share of the bank. This assumes both the market consensus regarding the 2015 earnings for Santander Brasil and an acceptance of the offer for all shares held by the minority shareholders.”

The executive chairman of Banco Santander indicated: “This step also strengthens the geographic diversification of Banco Santander, which will be key to consolidating this new phase of our growth in profits.” For that reason, she pointed to the bank’s results in the first half of the year, with a profit of EUR 2,756 million, 22% higher than the first half of the previous year. “We are particularly satisfied with the positive developments in revenues, cost control and the falling cost of credit, and with the decrease in non-performing loans across the whole group, and specifically their stabilization in Spain. At this time, the positive trends in group results are continuing.”

“I feel particularly committed to this challenge, and I also have an excellent team and the support of a board of directors with great experience. Maintaining the success story of recent decades will not be easy: the new competitive and regulatory environments are ever more demanding. However, we have a great opportunity and I approach this task with great confidence. I believe that we succeed because I know our teams well: their commitment to Santander, their highly qualified members, and their dedication to our clients. I have complete confidence that together we will make Santander the leading institution for employees, clients, shareholders and society.”

Banksville Partners Expands in Latin America Opening Buenos Aires Representative Office

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Banksville Partners LLC expands presence in Latin America with the opening of a representative office in Buenos Aires and the addition of experienced international banker Hugo Pezzoni.

“Pezzoni’s experience in structured transactions augments our capabilities to assist clients with strong revenue track-records who operate even in the more volatile of our regional markets,” said Daniel Casal, Banksville’s Senior Managing Director in charge of client origination.

In this new role, Hugo Pezzoni will be a Director and Representative of Banksville Partners, based in Buenos Aires, Argentina. He will assist both Argentine clients and work on important assignments throughout the firm’s Latin American network. Previously, Pezzoni was a senior banker at Rabobank International and JP Morgan Chase & Co. focused on Loan Syndications, Trade Finance, Capital Markets, Restructurings, Credit and Equity Investments.

“We are very pleased to add the breadth of Pezzoni’s financing experience to our team and fill the growing needs of our clients throughout Latin America“, said Banksville’s Hernan Narea, Senior Managing Director and head of structured finance in New York.

Clarien Bank Targets LatAm Market With Board Appointment

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Clarien Bank Limited has announced the appointment of Ronaldo Veirano as an independent director to its Board of Directors. Mr. Veirano will be responsible for advising on the Bank’s growth and strategic expansion into Latin America.

Mr. Veirano’s appointment constitutes an important Board addition for Clarien Bank as it develops towards its objective of becoming a preeminent, international financial institution offering an expanded range of products and solutions in corporate and investment banking, wealth and asset management to clients globally.

In his role as the founding partner of Veirano Advogados, in Brazil, Mr. Veirano brings a unique perspective on private wealth and institutional banking opportunities currently present in Latin America.

Mr. Veirano is also a key leader in the promotion of Brazil’s global business development and currently a member of the executive committee of both the Brazil-China Business Council and the United States Business Council.

Mr. Veirano joins three presiding board members, Buford Alexander, Michael Quinn and Gregory Slayton. They add to the long standing management team of local Board Directors, James Macdonald, James Gibbons, Hal Masters and Andrew Parsons. Keith Stock also remains Chairman of the Board representing Clarien Group Limited.

Keith Stock, Chairman of Clarien Bank Limited, said: “With Edmund Gibbons Limited as one of Clarien’s shareholders, the reappointment of James Gibbons to Co-CEO demonstrates the continued commitment to Bermuda by the Gibbons family and indeed to Clarien Bank. I look forward to James’s stewardship as Co-CEO, as he and Ian drive progress and further strengthen the Bank’s relationship with our local, and global community. Mr. Veirano’s highly regarded legal and business expertise will be a huge asset to Clarien and its Board of Directors. Specifically, his specialist knowledge of the Latin American market and his long standing relationships with organizations present in the region will be essential in driving forward strategic growth in the Bank’s private wealth and institutional banking divisions.”

Mr. Veirano commented: “Clarien Bank is clearly at a very exciting stage in its international growth. With years of experience working with institutional banking and private wealth professionals, I look forward to the opportunities that my position with the Bank’s Board of Directors will help develop, most notably in Latin America. “Over the last two decades there has been a positive change in the LatAm market. The rapid rise of entrepreneurs and ultra-high net worth individuals has resulted in a greater demand for sophisticated wealth management, corporate banking and investment services. Brazil alone presents a particularly strong opportunity. Not only will it be the world’s fourth largest economy by 2030, but at present there are more than 200 high net worth individual’s worth over $500 million dollars residing there.”

In 2008 Mr. Veirano was recognized by the government of Brazil and awarded the prestigious Order of Rio Branco, in acknowledgement of his significant contribution to the promotion of Brazil’s relations with the world.

Which Are The Trends which Chart The Path for Family Offices?

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¿Cuáles son las principales tendencias que dibujan el camino de los family offices? — FIBA WM Forum. Courtesy Photo . Which Are The Trends which Chart The Path for Family Offices?

One of the primary tasks of a family or multifamily office is to ensure good planning, largely through the coordination of external professionals serving the family, but perhaps the most important thing is to resolve any problems of governance in order to lay the foundations for a successful future in the preservation of capital and a smoother path in family wealth management.

Here are some of the issues brought to the table as part of the presentation “Family Office as a Client”, which was held last Tuesday as part of the FIBA Wealth Management Forum in Miami. The conference, chaired by Allison P. Shipley, principal of Tax- Personal Financial Services Practice at PwC, included the participation of Santiago Ulloa, managing partner of WE Family Office, Annette V.Franqui, managing director of ForrestalCapital and Drake Jackman, managing director and head of LatAm for Northern Trust.

For Ulloa, when the time comes to get to work with a family, what that family wants to do, and where they want to go, outweighs the size of their wealth, which means that their purpose of organization takes precedence. Hence, he stressed that the first thing to do is to solve any problems of governance and legal structure. Often, members of the same family live in different jurisdictions, and on many other occasions face a serious lack of organization which leads the family aimlessly. Also, but not less important, is the task of coordinating and managing the various external suppliers who serve the family. “The trend in this regard is to hire the top of the class. We have internal resources and we coordinate with outside professionals.”

In this respect, Franqui pointed out that a family office must work together with family office service providers and also ensure that the established plan is followed.

With regard as to which trends currently move the industry, attendees agreed that many of the families they work with have members of the same family in different jurisdictions; hence the need for structuring, and for working towards complying with the various tax jurisdictions. Another trend which is found among family offices is the increase in joint ventures with other families, as well as that, increasingly, the family is seeking control and further training.

Franqui underlined that those cases of families wanting to do things together are becoming more and more common; and explained that in Southern Florida’s case, anetwork is emerging, and that this networking will eventually give significant results between now and 10-15 years. This is due to families who have been settling in the area in recent years, who already know, or are getting to know each other, and are laying business opportunities on the table.

For Ulloa, families are looking for direct investments because not everyone is willing to take the risk of investing in private equity. In this regard, Franqui agreed that closeness and knowledge take precedence over risk. “Thetendency to invest close, in those things that are familiar, still prevails,” hesaid.

Another important task of the family office is to “sit in on it” in order to gain a complete picture of the problems and needs of the family. “We manage any investments, from real assets such as the property management of real estate, to the most sophisticated, such as structuring a private equity,” Franqui said.

Meanwhile, Jackman, from Northern Trust, noted the importance of establishing regular meetings between family members, in order to, amongst other things, educate them on the risks they take, and to take the opportunity to also start educating the next generation, “which must be encouraged to work and to find out which is the area in which they can add the most value.”

The second edition of FIBA Wealth Management Forum 2014 was held last week in Miami with the participation of over 200 professionals, who during the sessions were able to hear, first hand, the issues and problems concerning industry.

Latin America Sees the Most Significant Growth in the Size of its Billionaire Population

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The Wealth-X and UBS Billionaire Census 2014, shows that 155 new billionaires were minted this year, pushing the global population to a record 2,325 – a 7% rise from 2013.

The combined wealth of the world’s billionaires increased by 12% to US$7.3 trillion, which is higher than the combined market capitalisation of all the companies that make up the Dow Jones Industrial Average.

The Wealth-X and UBS Billionaire Census 2014 – the only comprehensive, global study on the composition and dynamics of this top tier of the global ultra high net worth (UHNW) population – shows that Europe, with 775 billionaires, is the region with the most billionaires and billionaire wealth (US$2.37 trillion). North America – the region with the most billionaire wealth in 2013 – was overtaken by Europe in terms of billionaire wealth in this year’s census.

Asia, however, boasted the largest billionaire wealth increase, with the region’s billionaires’ fortunes growing by 18.7% over the past year. The region is responsible for 30% of the net increase in global billionaire wealth in 2014. Asia’s billionaire population grew by 10% in 2014, with 52 new entrants into the billionaire club – 33 are from China.

The United States maintains its position as the world’s top billionaire country with a population of 571 billionaires in 2014, followed by China (190) and the United Kingdom (130), which took the third spot from Germany (123) on the Top 40 Billionaire Countries/Territories list.

Below are other key findings from the Wealth-X and UBS Billionaire Census 2014:

Europe is home to more than a third of the world’s billionaire population.
Latin America and the Caribbean is the region that saw the most significant growth in terms of the size of its billionaire population (37.8%) in 2014, but Asia saw the fastest growth in billionaire wealth (18.7%).
The billionaire population in the Middle East shrank by 1.9%, but total billionaire wealth in the region rose by 16.7%.
The size of Africa’s billionaire population decreased by 4.8%, but the region’s billionaire wealth increased by 12.9%.
There was no change in the billionaire population in the Pacific (34 billionaires), but the region’s total billionaire wealth dropped by 2%.
Nearly 35% of the world’s billionaires are concentrated in 20 cities. Billionaires are transnational. They move from city to city, rather than from country to country.
Only 5% of the world’s billionaires are worth more than US$10 billion.
The average billionaire‘s wealth rose by 4.4% this year to just over US$3.1 billion.
The average age of the typical billionaire is 63, one year older than it was in 2013.
There are 2,039 male billionaires in 2014, accounting for 87.7% of the world’s total billionaire wealth of US$7.3 trillion.
There are 286 female billionaires in 2014, accounting for a 12.3% share of global billionaire wealth.

The census – which looks at the global billionaire population from July 2013 to June 2014 – examines this top-tier wealth segment by geographical location, gender, sources of wealth and personal traits.

“Wealth-X is pleased to partner with UBS for a second consecutive year to produce the Wealth-X and UBS Billionaire Census,” Wealth-X CEO Mykolas Rambus said. “Expert commentary from UBS complements Wealth-X’s global intelligence on the world’s billionaire population, producing a report that demonstrates a true collaboration between the global leader in wealth management and the world’s leading UHNW intelligence provider.”

Download the report at www.billionairecensus.com

Lucelly Dueñas Joins Bessemer Trust’s Miami Office as SVP, Associate Fiduciary Counsel

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Bessemer Trust has announced that Lucelly Dueñas has joined the firm’s Miami office Legacy Planning team as Senior Vice President, Associate Fiduciary Counsel, reporting to Mark R. Parthemer, Managing Director, Senior Fiduciary Counsel for the Southeast region.

Ms. Dueñas is responsible for advising domestic and international ultra-high-net-worth families as they navigate the complexities of wealth. She will specifically focus on cross border and international matters related to legacy planning, family governance, tax minimization strategies, and the implementation of estate plans.

Ms. Dueñas earned an LL.M. in Estate Planning from the University of Miami School of Law in Florida, a J.D. from Indiana University School of Law, and a B.S. in Psychology and a B.A. in Criminology from the University of Florida. She is fluent in Spanish.

Before joining Bessemer, Ms. Dueñas was a wealth advisor at J.P. Morgan Private Bank, where she worked with high- and ultra-high-net-worth Latin American families on the strategic planning of their wealth. Previously, she was an associate at the law firms, Guttenmacher & Bohatch, P.A., and Stephen A. Taylor, P.L.

“Lucelly’s depth and breadth of experience in providing exceptional advice and unparalleled client service will help to strengthen Bessemer’s ties to ultra-high-net-worth families and individuals in South Florida and across Latin America,” said Michael Marquez, Managing Director and Florida Region Head for Bessemer.

Founded in 1907, Bessemer Trust is a privately owned wealth and investment management firm that focuses exclusively on ultra-high-net-worth families and their foundations and endowments. The firm oversees $97.5 billion for approximately 2,200 clients and provides an integrated approach to the investment, trust, estate, tax, and philanthropic needs of its clients.

Deutsche Bank Study Shows Investor Demand Fuelling Dramatic Growth of Hedge Fund Liquid Alternatives

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A Deutsche Bank study revealed the true extent of demand for liquid alternative investments, with the percentage of participating investors allocating to such products up from 28% to 51% year-on-year. The study – From Alternatives to Mainstream (Part Two) – saw almost three quarters of alternative UCITS investors and nearly two thirds of investors into alternative ‘40 Act mutual funds planning to increase their allocations.

Liquid alternative investments are now the fastest growing part of the asset management industry. Alternative UCITS assets have grown over 40% annually since 2008, whilst the hedge fund industry has grown 13% and the wider European UCITS industry only 2%. Alternative mutual funds have grown by 38% annually during this period, compared to 9^%for US mutual fund industry.

Hedge funds have moved into the mainstream marketplace at an accelerated pace, bringing new products to market and driving asset growth.

Key findings of the study, which surveyed both investors and managers, include:

Liquid alternative investments are the fastest growing part of the asset management industry,having experienced a CAGR of roughly 40% since the 2008 financial crisis. Net inflows into liquid alternatives from survey participants are predicted to grow by 44% over the next 12 months, which translates to $49bn in new flows, compared to $34bn over the last 12 months.
In response to investor demand, hedge fund managers are quick to diversify their product offering, with 42% of responding managers currently offering liquid alternative products, up from 27% last year. A further 34% would consider including such products. One quarter of managers plan to launch at least one alternative UCITS product in the coming year, and 29% have similar plans for alternative ’40 Act mutual funds.
The move towards liquid alternatives has been most pronounced among large, well established managers, with more than two thirds with $5bn+ in AUM managing such product for more than three years. A third of these managers plan to launch at least one new liquid alternative product in the next 12 months.
Fundamental equity long/short is the most popular strategy for investors allocating to alternative UCITS and alternative ’40 Act mutual funds, which along with event driven and global macro represent the top three most sought after alternative UCITS strategies over the next 12 months. Fundamental equity long/short, fundamental equity market neutral and event driven are the top three most sought after alternative ’40 Act mutual fund strategies over the next 12 months.

Daniel Caplan, European Head of Global Prime Finance at Deutsche Bank,said: “The growth of liquid alternatives is a very real opportunity for investors who have previously been unable to access hedge fund strategies to do so in a liquid and regulated structure.”

Anita Nemes, Global Head of Capital Introduction at Deutsche Bank, said:Liquid alternatives are the fastest growing segment of the asset management industry. This presents a significant opportunity for investors to access better risk-adjusted returns, and also for hedge fund managers who are increasingly becoming solution providers to their investors.

The study surveyed 212 investor entities worldwide managing more than $804bn in hedge fund assets and 86 global hedge fund managers representing $6tn in firm wide assets.

Investors Are Anticipating Monetary Policy Separation of Fed and ECB

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Sentiment towards Europe has picked up in the wake of recent monetary policy easing by the ECB, while investors are increasingly sure of a rate hike by the Fed in spring 2015, according to the BofA Merrill Lynch Fund Manager Survey for September. An overall total of 202 panelists with US$556 billion of assets under management participated in the survey.

Belief in Europe’s stocks has started to recover after the heavily negative sentiment expressed in August’s survey. In the wake of the decision to lower rates to close to zero, asset allocators have increased exposure to eurozone equities. A net 18 percent are overweight the region, up from a net 13 percent a month ago. Europe is also the region that a net 11 percent of investors most want to overweight in the coming 12 months. Last month, a net 4 percent wanted to underweight Europe.

Global investors are predicting further policy action from the ECB – 42 percent of the panel now expects the ECB to start quantitative easing (QE) by the end of 2014, up from 32 percent expressing that view in August. Furthermore, the proportion saying there will be no QE program has fallen to 19 percent this month from 31 percent last month.

At the same time, expectations of Fed tightening have firmed. Nearly half (48 percent) of investors are expecting the first rate hike in nine years to take place in the second quarter of 2015, up from 38 percent last month. Accordingly, the proportion of respondents backing the U.S. dollar to strengthen against the euro and yen recorded a survey high of a net 86 percent.

“This month’s survey highlights the end of U.S. and European central bank consensus – and as the first Fed rate hike since 2006 draws closer, we’ll see a new U.S. dollar bull market and movement out of bonds,” said Michael Hartnett, chief investment strategist at BofA Merrill Lynch Research. “While investors welcome the ECB’s actions, the region is still lacking its growth mojo. It will take time for growth to materialize from policy action, and there are no guarantees it will,” said Manish Kabra, European equity and quantitative strategist.

Investors awaiting return of growth mojo

Despite the headline cash level falling, September’s survey indicates that investors are treading water. Average cash balances, which soared a month ago to 5.1 percent of portfolios, have fallen back in line with July’s levels at 4.6 percent. But that does not mean investors are rushing to take on more risk. A net 22 percent of asset allocators say they are still overweight cash (down from a net 24 percent in August).

Allocations to equities ticked up modestly – with a net 47 percent overweight the asset class, up by a net 3 percentage points a month ago. The proportion of allocators underweight bonds fell two percentage points to a net 60 percent. Movements in and out of sectors were limited with Materials and Energy making greatest gains.

The lack of movement perhaps reflects a static outlook on the economy. A net 54 percent of the global panel expects the world economy to strengthen in the coming year. Expectations in profits paint a similar picture with a net 37 percent saying profits will improve in the coming year, down two percentage points month-on-month.

Investors have expressed caution towards use of capital by corporates – the proportion of investors urging companies to increase capital spending has fallen six percentage points to 56 percent. More investors want to see companies return cash to shareholders.

Scottish independence threat deepens troubles for UK equities

As opinion polls indicated the referendum for Scottish independence was too close to call, negativity towards U.K. stocks deepened. The U.K. has entrenched its status as the world’s least popular region among asset allocators this month. A net 16 percent of the panel is underweight U.K. equities.

Looking ahead, the U.K. is the region that global investors most want to underweight in the coming 12 months – with a net 14 percent of those surveyed expressing that view. Furthermore, a net 20 percent say that the U.K. has the least favorable profit outlook, up from a net 12 percent in August. Investors have not markedly changed their view on sterling valuation, however.

PREI Hires James Glen as Portfolio Manager for Core US Real Estate Fund

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Prudential Real Estate Investors has named James Glen a principal and portfolio manager for its core U.S. real estate fund, the company has announced. PREI, among the world’s largest real estate investment management and advisory businesses, is a business of Prudential Financial, Inc.

Glen, whose appointment is effective immediately, joins the fund’s current portfolio management team comprised of Cathy Marcus, managing director and senior portfolio manager; Frank Garcia, managing director and portfolio manager; Joanna Mulford, managing director, portfolio manager and chief financial officer; and Nicole Stagnaro, vice president and assistant portfolio manager.

Glen will focus on asset management oversight and transactions, and will work with the team on fund strategy. He is based in Madison, N.J. and reports to Marcus.

Before joining Prudential, Glen served as global head of research and strategy within BlackRock’s real estate group, responsible for monitoring global real estate markets and formulating investment strategy to support investments across the United States, Europe and Asia Pacific. Previously, he spent more than five years with BlackRock’s portfolio management group where he worked on the core and opportunistic real estate funds in the United States and internationally. Prior to that, Glen was a senior economist at Moody’s Analytics and began his career as an analyst at JP Morgan Chase.

Glen’s hiring comes ahead of Marcus moving into the role of global chief operating officer of PREI in January 2015. At that time, Garcia will become senior portfolio manager with Marcus continuing to dedicate a portion of her time to facilitate a transition of the fund through the end of 2015. Marcus has been with PREI for more than 15 years, the last 10 of which she has spent as a member of the firm’s core U.S. real estate fund. Garcia joined PREI in 2013.

“James’ deep investment experience and extensive strategic analysis of the U.S. and global real estate markets will complement the strengths of our core U.S. real estate fund portfolio management team,” said Kevin R. Smith, head of PREI in the Americas. “With Cathy taking on the role of global chief operating officer of PREI and Frank assuming the senior portfolio manager role in January 2015, we are pleased to have someone of his caliber join the firm.”

Glen earned a bachelor’s degree in economics from the University of North Carolina at Greensboro and a master’s degree in economics from the University of Delaware.

Onshore vs. Offshore: The Latin-American Client Decides

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Onshore vs offshore: el cliente latinoamericano es el que decide — Onshore vs Offshore Forum. Courtesy photo of FIBA. Onshore vs. Offshore: The Latin-American Client Decides

The current reality of high net worth clients in Latin America has little to do with that of 10 or 15 years ago, when, for many of them, political instability and insecurity in their countries, to mention just a few of the issues involved, were reasons to opt for offshore investments before investing their money at home.

This trend has changed, and not because these problems have been resolved in all Latin American countries; they have been resolved in some and diminished in others, while in others they remain the same or are even worse today than they were a few years ago; generally speaking, however, the situation has improved somewhat, although we must understand that the region can never be taken as a whole.

When opting for the onshore versus offshore investment, it is vital to begin with an equity analysis, and to ponder which jurisdictions are best suited to each case in order to always obtain the best performance for each private banking customer’s estate.

These were some of the topics discussed at the conference on Monday: “What is happening in Latin America? Local vs. Offshore? Who are the regional drivers?” The conference was held under FIBA Wealth Management Forum, which took place in Miami this week. The panel was moderated by Federico Muxi, partner and managing director of Boston Consulting Group, with the participation of Claudio Prado Arcirio de Oliveira, general manager of Banco do Brasil; José Ramón Rodriguez, international wealth strategies director for BBVA Compass, as well as Nicolas Bergengruen, managing director of UBS WM Americas International (Miami complex) and CEO of UBS FS (Uruguay), and Cristian Gonzalez Lami, managing director of Credit Suisse Securities (USA) Private Banking Latin America.

Federico Muxi pointed out that 2013 was a very good year for the wealth management industry worldwide, as it was a year in which private banking assets negotiated and held in offshore districts totaled $ 8.9 trillion, an increase of 10.4 % from 2012. In its global wealth annual report, which was submitted mid-year, Boston Consulting estimated that by the end of 2018, offshore wealth will eventually reach 12.4 trillion dollars. Latin America currently accounts for 12% of global wealth in offshore jurisdictions. “Therefore, it is not surprising that the region is so attractive for the wealth management industry,” he said.

For José Ramón Rodríguez of BBVA Compass, the decision on whether to invest locally or abroad must always be linked to the needs of the family and its wealth; furthermore, what should be considered is not so much the debate onshore vs. offshore, but rather where to invest in a more efficient way. “I think there are many opportunities locally, but also abroad. Hence the opportunities in alternative investments such as art, real estate …” Rodriguez believes there are many offshore opportunities and that institutions, being aware of this, create the best solutions for their clients, making it clear that there is no single reason which tips the scale either way on the debate of offshore vs. onshore investing “many Latin American families have both onshore and offshore investments, and that diversification is what drives many of them,” he added.

Nicolas Bergengruen, from UBS WM Americas agrees that diversification is an attraction for the offshore market, as well as political instability, which thanks to some countries in the region shall continue to benefit the sector.

As for Miami’s position as the hub in the offshore market for Latin America, the UBS executive said the city is going through a very sweet moment. “Miami has a great opportunity to leverage its hub status, plus the advantage of being in the same time zone, which translates into an opportunity for US booking centers”.

In this regard, Bergengruen explained that UBS has three booking centers in the country which are benefiting from diversification and their easy access as well: New York, Miami, and the West Coast. What they all agreed on was that the greater the weight of a client, the easier it is for them to opt for the offshore market; the scale is also more inclined to offshore in clients from countries with higher risk, while in the case of smaller clients, the scale tips towards the onshore side. Thus, the manager of BBVA Compass said that the United States is increasingly gaining more weight as a hub for offshore investment for the Latin American client, while they also stressed that transparency will also help to bring business closer to home.

Meanwhile, Gonzalez Lami, of Credit Suisse said the local position which the Spanish banks have reached in Latin America, being amongst the “big players”, is difficult to achieve in terms of organic growth. There is much local competition in the onshore market; hence the move from Credit Suisse strategically arrives for the offshore market. He also referred to cases such as Venezuela and Argentina, where there are investors seeking jurisdictions which respect the law.

As for the trend of local players providing offshore investments via local firms, González Lami was convinced that the future will be governed by synergies that serve both markets and that conform to the needs of each client depending on their wealth.