With the objective to promote innovation and sustainability, European Fund Administration (EFA)has recently upgraded its IT infrastructure to offer clients fund administration services powered by a state-of-the-art and green IT platform.
To guarantee best performance and permanent continuity of EFA’s services, the infrastructure, distributed across two IT rooms, individually sized to operate all production activities are now both hosted in certified Tier-IV data centers.
Jean-Marc Verdure, Director of IT, Organization & General Services says: “Our applications are running on mission critical computer systems hosted in award-winning Tier-IV data centers offering the highest level of availability with fully redundant subsystems, supervised and managed on a 24/7 basis. In the event of a technical incident or unavailability of a data center, a partial or overall take-over of our services and applications can be done instantaneously in a single data center”.
This upgrade has also enabled EFA to renew hardware and systems with sustainable and eco- friendly components and processes (materials, cooling systems, power consumption management, recycling…) to promote a better approach to Corporate Social Responsibility. To confirm its commitment in behaving responsibly by integrating environmental concerns into business operations, EFA was also recently awarded the EcoVadisCorporate Social Responsibility silver rating.
Multi-asset funds are set to stay at the top of European inflow tables, as the bond rout of the spring and August’s equities plunge serve as reminders of the dangers of being stuck in one asset class, according to the latest issue of The Cerulli Edge – Global Edition.
Cerulli Associates, a global analytics firm, believes there may yet be opportunities for asset managers to launch more multi-asset products, especially in the passive space. It notes that more advisors are recommending this funds, despite previous concerns that asset allocation products were usurping their role. Following the Retail Distribution Review (RDR) in the United Kingdom, many advisors are outsourcing asset allocation and find multi-asset products the best solution.
By highlighting the cost of advisors, the RDR may have also inadvertently boosted MA funds. Cerulli says that more investors, whether pension-oriented or not, are going down the direct-to-consumer route and MA funds offer cheap access to a range of asset classes, often through low-cost platforms.
«Asset management companies should not be reluctant to take risks and differentiate themselves from the crowd. For the best, the rewards can be significant, even with products that are largely fettered funds of funds,» says Brian Gorman, an analyst at Cerulli.
With investors abandoning low-yielding products in favor of better, but safe, returns, flows into multi-asset funds in the first half of 2015 alone, at €123.9 billion (US$137.5 billion), almost matched those for last year as a whole, and were about five times those of the 12 months of 2012. For established asset managers with expertise across asset classes, existing products can easily be leveraged to offer MA funds.
However, there is not universal enthusiasm. Several wealth managers have told Cerulli that they are not recommending MA funds, with some advisors preferring to retain control of the asset allocation process, despite the increased burdens of RDR. Another common complaint concerns the complexity of the product.
«Some investors, and even advisors, say MA funds are hard to understand,» says Barbara Wall, Europe research director at Cerulli. «If advisors do not know what is going on with a fund, it may conflict with the asset allocation they are trying to effect through other products they are recommending for their clients.»
There is some skepticism as to whether the U.K. pensions revolution introduced this year represents a bonanza for fund providers. Acknowledging that considerable scale may be required to realize a significant gain, Cerulli maintains that the downside is minimal, especially for firms that can set-up suitable low-cost products. It believes that the balance of probability is in favor of such funds offering sizeable opportunities for asset managers.
While the RDR driver for MA is not yet as strong in most of Continental Europe as it is in the United Kingdom, some asset managers say change is on its way. One told Cerulli it had already seen a trend of retail banks, aware the days of retrocessions are coming to an end, setting up their own MA products. They are also seeking firms to act for them as subadvisors.
Other Findings:
Increasing headcount is on the agenda in the United States as institutional sales managers at large and small asset managers respond to the changing needs and expectations of clients. Cerulli notes that increasing client-service roles is particularly important. Experts are required, as is greater collaboration between teams, says the global analytics firm.
In charting the fund-buying journey of more than 70,000 individuals in 11 jurisdictions across Asia, Cerulli has observed the importance of trust and the explosive growth of online direct-to-consumer platforms. Regular income/dividend payout is key for investors in the region. Cerulli notes that a clear and well-executed digital strategy is crucial for marketing success.
Regulatory risk is inhibiting asset managers in Europe and the United Kingdom, while potential disruptors are deterred by regulatory requirements and reputational damage, says Cerulli. It warns that asset managers slow to embrace mobile technology risk disruption from alternative distribution channels, where the emphasis is less on buying products–which the industry is comfortable with–and more on engaging and empowering customers.
Jeremy Lawson, Chief Economist, Standard Life Investments said at the publication of the Global Outlook from Standard Life Investments: “We continue to see a moderate global expansion into 2016, supporting modest corporate earnings growth outside the energy and materials sectors. Our view remains that a widespread or systemic emerging market financial crisis is unlikely, but the pressure on a number of large developing economies will not disappear quickly. Global GDP growth is expected to improve marginally but remain below trend.
“The implications for investors are considerable, as they need to consider throughout their strategic asset allocation process what the repercussions are of low returns on bond, cash and equity prices over the remaining part of this business cycle. Listed equities in particular are sensitive to developments in global activity, as they tend to have larger external exposures than do economies as a whole. Moving up the capital structure towards selected credit may have advantages in this environment.
“At the epicenter of the crisis, in China, a hard landing is not our central scenario as we expect extra fiscal stimulus, but the transition to a new growth model will remain bumpy and unfriendly for commodity producers. More deceleration in growth could lie ahead and the Chinese currency is likely to weaken moderately against the dollar.
“Our forecast assumes no further falls in commodity prices and stabilization in the recent levels of financial stress. If stress builds further then there is a large risk that growth will not rebound, through its effect on consumer and business sentiment, when monetary policy easing in the developed economies will quickly come back on to the agenda.”
Foto: Jimmy Baikovicius
. Terrapin une a banqueros privados y family offices en el Wealth Management Americas
For the past 8 years, Terrapinn has run two co-located Wealth Management events in Miami: Private Banking LatAm and Americas Family Office Forum. Since these 2 industries have converged, they have decided to rename the event Wealth Management Americas 2015.
Wealth Management Americas, to be held Nov. 17-18 at the Four Seasons Hotel in Miami, will bring together the most senior executives from US and LatAm Private Banks and Family Offices to discuss today’s latest investment opportunities across all asset classes, as well as the latest trends within family governance, wealth planning, and timely regulation topics around FATCA.
Global private equity fundraising saw a further slowdown through the third quarter of 2015. One hundred and seventy funds closed, down from 317 in Q2 2015 and 290 in the same period last year. The aggregate capital raised by funds closed in this quarter was $116.9bn, down from $129.3bn in the previous quarter. It was the third consecutive quarterly decline in fundraising, and represents a 29% decrease from the $164.9bn raised in Q4 2014, the most recent fundraising peak. In 2015 YTD, private equity funds have raised an aggregate $385.4bn, down from $388.1bn in the first three quarters of 2014.
“The global private equity fundraising market has continued to stall in the third quarter of 2015. The number of funds closed is the lowest of any quarter Preqin has on record, and aggregate fundraising totals declined for the third consecutive quarter. Despite recent turmoil in Asia, there has been an increase in fundraising for funds focused on the region, and on Rest of World. This, though, does not offset a lack of growth in the mature North American and European markets, as both the number of funds closed and aggregate capital figures continue to fall there.” Says Christopher Elvin – Head of Private Equity Products, Preqin.
Private equity funds closed so far in 2015 have taken an average of 16.3 months to reach a final close. This figure has risen slightly from Q2’s 16.2 months, but is still below the average 16.7 months that it took for funds closed in 2014 to fundraise.
Fundraising totals for venture capital, real estate, and funds of funds all decreased, while infrastructure fundraising rose from $4.4bn in Q2 to $13.1bn in Q3.
The number of private equity funds in market is currently at a record high. 2,348 funds are seeking a combined $831bn in commitments, up from 2,248 funds seeking $781bn at the end of last quarter. Dry powderlevels have not continued the rapid increase seen through H1 2015, and currently the overall figure stands at $1.35tn.
Foto: Alice Popkorn
. El número global de millonarios podría crecer un 46% en los próximos cinco años
El tamaño y la riqueza de la clase media global crecieron rápidamente antes de la crisis financiera, pero el crecimiento disminuyó después del 2007 y se ha visto en todas las regiones aumentar la desigualdad, según el sexto informe sobre riqueza global “Global Wealth Report” publicado esta semana por el Credit Suisse Research Institute, centrado en la evolución de la clase media desde la llegada del nuevo siglo.
El informe muestra que la riqueza global se redujo en 13 billones de dólares de mediados de 2014 a mediados de 2015, debido a la apreciación del dólar. Los autores aclaran que si la medición se hubiera hecho a tipos de cambio constantes, la riqueza global se habría incrementado en 13 billones de dólares desde el año pasado. De acuerdo con la compañía, la riqueza global puede llegar a los 345 billones de dólares para mediados de la próxima década, un 38% más que lo registrado a mediados de este año y el número de millonarios a nivel mundial pudiera incrementarse en 46% en los próximos cinco años, llegando a 49,3 millones para mediados de la siguiente década.
Los Estados Unidos siguen a la cabeza con un fuerte incremento en la riqueza de los hogares (4,6 billones de dólares). Por su parte, China -que presentó un aumento de 1,5 billones de dólares- tiene la clase media más grande del mundo, con 109 millones de personas, superando a los EE. UU. -que cuenta con 92 millones-.
Suiza vuelve a encabezar la media de riqueza por adulto. Esta variable –la riqueza meddia por adulto- cayó en 6.2% hasta los 52.400 dólares y se encuentra por debajo del nivel de 2013 –muestra el informe- y una persona necesita 3.210 dólares (después de pagar deudas) para estar en la mitad más rica del mundo.
El análisis por regiones muestra que Europa fue responsable de la pérdida de 10,7 billones de dólares del total de riqueza, cediendo más del doble que la región Asía Pacífico (incluyendo China e India) que bajó en 3,9 billones. En términos porcentuales, América Latina experimentó la reducción más grande entre las regiones, 17.1%. También cabe señalar que, en términos porcentuales, China está significativamente por encima de América del Norte (7.0% frente a 4.4%), en parte porque las ganancias en los EE. UU. se compensaron con pérdidas en Canadá.
La cima de la pirámide
El Credit Suisse Research Institute estima que existen 123.800 personas en el mundo cuyo patrimonio supera los 50 millones de dólares, de estos 44.900 tienen al menos 100 millones de dólares y 4.500 superan los 500 millones de dólares. En América del Norte viven 61.300 (50%) de estos individuos.
Estimaciones de la firma sugieren que el número de millonarios podría exceder los 49,3 millones de adultos en 2020, un incremento de más del 46,2%. De entre las regiones, el mayor incremento se podría ver en China, con un 74%, y posiblemente África, con un incremento de 73% en el número de personas millonarias.
Foto de William Warby
. La Fed subirá las tasas, pero no debe cundir el pánico
Ocho años después de que la Reserva Federal (Fed) elevara tasas por última vez y más de seis años desde la última vez que las tocó, ha llegado el momento para una nueva alza. Los cambios en la política monetaria siempre han impactado a los mercados, y teniendo en cuenta la duración y el alcance de las intervenciones de los bancos centrales a nivel mundial desde la crisis financiera de 2008, esta inminente alza no será la excepción.
Mientras las subidas de tipos a menudo se han dado como respuesta a un sobrecalentamiento de la economía, esta vez será decididamente diferente. La Fed simplemente está retirando las medidas de emergencia implantadas en 2008, buscando regresar a lo «normal», en una economía global que es intrínsecamente diferente de lo que era hace casi media generación. La Fed también ha prometido que los aumentos en las tasas serán medidos y graduales, por lo que no deben descarrilar la expansión de Estados Unidos en el largo plazo.
Pero los cambios en los planteamientos de inversión no se detienen ahí. En un análisis más profundo, encontramos factores estructurales que están redefiniendo la economía, la inflación y el panorama de inversión. La comprensión de estas influencias, asegura BlackRock, es incluso más importante para los inversionistas a la hora de desarrollar estrategias a largo plazo en una economía inmersa en un ciclo de subidas de tasas.
¿Cuál es el primero de estos factores? Innovación y tecnología. Esencialmente, al reducir los costos laborales totales mientras se mejora la eficiencia, la innovación tecnológica tiene el potencial de impulsar los modelos de negocio con pocos activos físicos e incluso actuar como una fuerza deflacionista. El efecto no siempre es fácil de medir, pero varios sectores están mostrando signos notables (por ejemplo, el sector energético). Al crecer la producción con un incremento menor de las inversiones, se presenta la denominada “deflación de la producción”. Así, ante una falta de inflación, a pesar de tímidos aumentos salariales, la renta disponible puede aumentar.
Un segundo factor igualmente importante, que afecta a las perspectivas del mercado es la demografía global. Teniendo en cuenta que las poblaciones que envejecen generalmente consumen más de la economía de lo que contribuyen a ella, se cree que el cambio demográfico en los países desarrollados contribuye a la desaceleración del crecimiento económico en el largo plazo. Además, las poblaciones maduras tienden a usar menos crédito y muestran una preferencia por la renta fija, impulsando así la demanda de bonos a largo plazo, lo que afecta a los rendimientos y las tasas de interés.
El impacto predominante de estas tendencias tecnológicas y demográficas se traduce en presiones deflacionarias que, para disgusto de los bancos centrales, no son fácilmente influidas por la política monetaria. Todo esto indica que las economías globales podrían permanecer en un ciclo de baja inflación, bajas tasas y bajo crecimiento por algún tiempo, más allá de la primera subida de tipos de la Fed.
Algunas ideas para ajustar su cartera
En este entorno, ser conscientes del riesgo de duración es crucial. Teniendo en cuenta los factores configuran el entorno de la renta fija, los bonos de ultra corta y larga duración en Estados Unidos parecen menos vulnerables a un aumento de las tasas que los vencimientos a medio plazo. Piense también en otros activos de renta fija para sus cubrir sus necesidades de rentas, por ejemplo, los bonos del Tesoro ligados a la inflación (TIPS) y la renta fija high yield, pero no sobre exponga su nivel de riesgo para alcanzar un mayor nivel de rentas.
Ante todo, debe recordar el papel de los bonos en su cartera. Ya sea porque usted está buscando ingresos fijos, diversificar el riesgo, o diluir los efectos de las alzas de tasas, el riesgo de crédito o el de inflación, debe ser consciente de las motivaciones que hay tras su estrategia de bonos. Ahora tiene la oportunidad de analizar su estrategia en renta fija y preparar su cartera de bonos para el entorno de rendimientos de la nueva e inminente economía «normal».
Este material es para fines educativos únicamente y no constituye asesoría de inversión, ni oferta ni invitación para comprar o vender valores en jurisdicción alguna (o a persona) donde dicha oferta, invitación, compra o venta sea ilegal conforme a las leyes de valores de dicha jurisdicción. Si algunos valores o fondos están referenciados o inferidos en este material, dichos valores o fondos puede ser no registrados ante los reguladores del mercado de valores de cualquier país en Latinoamérica y Ibérico, y por tanto, dichos valores no puedan ser objeto de oferta pública dentro del territorio de dichos países. La veracidad de la información contenida en este material no ha sido confirmada por el regulador del mercado de valores de ningún país dentro de Latinoamérica y Iberia.
Venture capital investment, accelerator programmes and a proactive focus on the deployment of new technologies through allegiances with fintech companies should be priorities for banks as a multiplicity of new payment capabilities come to the fore, according to a new report by BNY Mellon.
The new report, Innovation in Payments: The Future is Fintech, follows on from Global Payments 2020: Transformation and Convergence and hones in on the growing influence of fintech in transaction banking. It assesses the direct and indirect impact of the new technology on payments and the way in which it is moulding client behaviour and fuelling expectations for better, faster and more innovative solutions across the payments spectrum.
Cutting-edge technology holds great potential to transform how consumers and clients initiate and process transactions. It’s no longer just a case of new currencies or faster payment methods, but an entire rethinking of how transfers of any «value» might be undertaken. More fintechs are graduating from the ranks of start-ups to multi-billion dollar listed companies: at least 4,000 fintech start-ups are active and global investment in fintech ventures tripled in 2014 to $12 billion.
«The fintech era is upon us and banks shouldn’t merely be mindful of this; they should also have a clear strategy in place in order to adapt to and benefit from fintech-fuelled changes,» said Ian Stewart, Chief Executive Officer of BNY Mellon’s Treasury Services business. «While the banking industry is traditionally conservative about change, any hesitation or ambivalence here could be costly. In order to position themselves at the centre of the payments industry of tomorrow, banks must act today to understand, interact with, and cherry-pick from the full smorgasbord of fintech developments.»
«BNY Mellon is immersed in the fintech sector,» adds Stewart. «We are focusing on and investing a great deal of time in exploring the opportunities it has to offer the global payments arena in areas such as the potential to reengineer payments, including blockchain and big data technology. We are also working closely with fintech firms to explore the use of new technology capabilities.»
«As a major provider of wholesale banking services to client banks, we’re committed to staying current on evolving conditions in the banking industry, and liaise with our client banks about how the changing landscape is likely to impact their business strategies,» said Anthony Brady, Global Head of Business Strategy & Market Solutions for Treasury Services at BNY Mellon. «Our research into the changing transaction banking ecosystem has important implications for us as a business, and we’re eager to discuss with client banks how our investments in technology are positioning us to be an even better provider of support to them as they align their business plans with the emerging future state of our industry.»
While regulation has put pressure on bank resources, banks must prioritise technology-focused strategies. The financial services industry has one of the highest ratios of IT spend as a proportion of revenue, with levels expected to reach US$197 billion in 2015. That said, over three quarters of this is estimated to be in maintenance rather than new services, so banks need to redress this imbalance. The report examines what strategies banks should adopt in order to understand and access these exciting fintech-fuelled developments, and thereby future-proof their long-held position at the heart of global payments.
To view the report, Innovation in Payments: The Future is Fintech, please click here.
Investors are expressing growing skepticism that the U.S. Federal Reserve (Fed) will raise rates this year amid fragility in the global economy and earnings, according to the BofA Merrill Lynch Fund Manager Survey for October.
Fewer than half (47%) of investors believe the Fed will raise rates in 2015, down from 58% in September.
A net 19% of the panel says global fiscal policy is too restrictive.
Cash balances fell to 5.1% of portfolios, down from 5.5% last month, but remain above historic average levels.
A growing majority of investors (net 26%) say that corporate operating margins will decrease in the coming year, up from a net 18%.
Short Emerging Market Equities was named the most crowded trade in October by 23 percent of the panel, up from 20%.
China is seen as the greatest “tail risk” by 39% of the panel, down from 54% in September, while pessimism over Chinese equities eased.
“As investors debate the timing of a rate hike, they should be anticipating a massive policy shift in the U.S., Europe and Japan from QE to fiscal stimulus in 2016,” said Michael Hartnett, chief investment strategist at BofA Merrill Lynch Global Research.
To remain competitive in today’s financial advice industry, broker-dealers must recalibrate their relationships with their advisors, according to a whitepaper released by Pershing. The report, “Why Teams Are the Client of the Future for Broker-Dealers”, points out that changes in the advisor-client of the modern broker-dealer present different challenges and opportunities that broker-dealers must navigate. These changes provide broker-dealers with an opportunity to rethink their overall strategies to attract and retain top clients.
According to the report, the top client of today’s successful broker-dealer is not a «rep» or even an «advisor» but an ensemble, which is a firm or a team of multiple professionals that service and manage client relationships. Ensemble teams are already controlling a significant percentage of broker-dealer revenue, growing faster than the average practice, servicing a higher-net-worth client base and offering better career growth opportunities. Most importantly, ensembles are net acquirers. They are acting as a successor for many of the smaller solo practices and are likely to emerge as the ultimate consolidators of the industry.
«Broker-dealers have formed traditional affiliation models around individuals, which don’t necessarily work as well for ensemble firms,» said Jim Crowley, chief relationship officer and managing director at Pershing. «However, broker-dealers that recognize and understand that their top client is a team rather than an individual will not only strengthen existing relationships with these clients, but will also position themselves for organic growth and strategic acquisitions.»
While ensembles are valuable to broker-dealers, they are also at risk of being lost as clients. Many larger teams are departing broker-dealer firms to become independent. These advisors, known as breakaway advisors, are moving to a registered investment advisor (RIA) or hybrid business model. Industry changes continue to increase the possibility that successful teams will part ways with broker-dealers.
Despite the challenges, broker-dealers can successfully recruit, retain, and work with ensembles by better understanding how they work and by restructuring affiliation models. Pershing’s report highlights actionable ways for broker-dealers to accomplish this, including:
Restructure relationship management: Broker-dealers should maintain a relationship with multiple individuals within the ensemble team, including the CEO/managing partner/leader, COO/operations leader, advisors and next generation of successors.
Focus on holistic financial advice: Since more than 70 percent of a large advisory firm’s revenue comes from advisory fees, broker-dealers should seek to reframe the relationship with the firm as one of offering a spectrum of financial advice and serving in a more custodial capacity to demonstrate the greatest value to the advisory team. This includes understanding the investment philosophy of the ensemble team, knowing the tools advisors need to run their business efficiently, integrating technologies and support, offering holistic planning, and building confidence and trust through open communication.
Understand the ensemble team’s vision and business strategy: To be a good business partner, broker-dealers need to ask advisors about where they envision the future of the ensemble team in five to 10 years. Ideally, the vision should be one where there is collaboration with the broker-dealer at some level. The more the two firms work on the strategy together, the longer and stronger the relationship will be.
Think in terms of outsourcing: One of the most productive avenues for strategic partnership is outsourcing. Activities that advisors can outsource to their broker-dealer include: compliance, technology, due diligence, back-office operations and practice management.
Give ensemble teams examples of success and thought leadership that they can study and replicate: One of the primary reasons advisory firms leave broker-dealers and become RIAs is that they perceive it to be the path followed by large and successful businesses. To be successful, broker-dealers need to create examples of the collective intellectual capital that can be leveraged to demonstrate expertise and show value to investors.
Create and foster a culture: If the broker-dealer and advisory firm share the same values and goals, the relationship will be strong, durable and successful. To continue to foster that culture, broker-dealers need to regularly come together with advisors in a constructive dialogue about their business strategies and expectations of each other.
To obtain a copy of Pershing’s whitepaper Why Teams Are the Client of the Future for Broker-Dealers, please use this link
