Robert Forsyth Joins Lazard AM as Global Head of ETFs

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Lazard Asset Management has announced Robert Forsyth as the new global head of ETFs to drive the development and expansion of the firm’s active ETF platform.

Based in New York, Forsyth joins Lazard Asset Management from State Street Global Advisors, where he was most recently the global head of ETF Strategy. During his time at State Street Global Advisors, he held various leadership roles in product strategy, investment, and sales for the company’s trillion-dollar ETF business.

“We are continuously evolving our platform so that more clients can access our leading investment strategies. Building and expanding an active ETF platform is a key step in our plans, and Rob will play an important role in accelerating our ambitions. Throughout his career, Rob has distinguished himself as a leader capable of building, scaling, and distributing exchange-traded products that resonate with a broad range of investors. We look forward to leveraging the breadth of his skills and experience to advance our vision and objectives,” said Evan Russo, CEO of Lazard Asset Management.

Forsyth has developed a deep understanding of the ETF ecosystem over more than 20 years of working with exchange-traded products. At Lazard, he will report to Jennifer Ryan, head of distribution in North America, and work closely with the firm’s leadership team to build its ETF offering, the statement adds.

“The opportunity to join Lazard and help this historic firm build its active ETF platform is unique,” said Forsyth.

In June 2024, Lazard Asset Management launched its first ETF product, the Lazard Global Listed Infrastructure Active ETF, for Australian investors. The firm plans to continue building on this launch, along with a new sub-advised ETF mandate in the U.S.

Lazard offers clients a range of active equity and fixed-income products through mutual funds, UCITS, and SMAs. In addition to offering prominent active strategies in the U.S., the firm has long been a leader in providing global, international, and emerging markets strategies for its global client base, according to the statement obtained by *Funds Society*.

This appointment is the latest in a series of high-level hires for Lazard Asset Management. The firm’s plan to build its ETF platform is part of its ongoing strategy to develop products and solutions that continue to evolve Lazard’s investment platform and distribution capabilities.

The Employment Data Provides Certainty of a Rate Cut; the Question Is No Longer When but by How Much

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Elecciones en EE.UU. y mercados

U.S. employment figures showed a slowdown in the economy, paving the way for the much-anticipated interest rate cuts in September.

However, with an economy losing momentum in job creation but maintaining strong budgets for wages, the question is now how much the Fed will cut rates next week.

According to an analysis by alternative asset manager KKR, while the August nonfarm payroll data reflected a clear weakening of the U.S. economy, “the report did not unequivocally confirm that the Fed must ease its monetary policy by 50 basis points.”

The Global Macro team’s report, led by Henry H. McVey, acknowledges that although attention is focused on the 142,000 jobs added in August—slightly below the consensus of 165,000 but above July’s revised 89,000—the key point is that, despite downward revisions, the year-over-year growth rate was higher than in July.

Experts note that with previous months’ revisions, job growth has fallen below 125,000 every month except one since April. They add that a stagnant labor market (i.e., where hiring, layoffs, and turnover are low) means that the slowdown in labor demand will increasingly show up in weaker overall data.

The KKR report estimates that August’s employment data will not be “perceived as negatively as some had expected.”

“Although the negative revisions are notable, our overall message remains that the Fed must act aggressively, but we are not convinced that this will include 50 basis points initially, especially since financial conditions remain quite favorable. In the past, 50-basis-point cuts to start a cycle often included higher credit spreads and higher unemployment rates,” the report adds.

Employment growth in August came in slightly below expectations (142,000 versus 165,000), but the most notable elements of the report were the substantial downward revisions from previous months (-85,000 net).

From the independent advisory platform Sanctuary, an analysis by Mary Ann Bartels, shared with the firm’s clients, anticipates a 25-basis-point rate cut by the Fed.

“With employment data pointing to a slowdown in the labor market, the likelihood of a rate cut is almost assured. Mary Ann continues to expect a 25-basis-point cut by the end of this month, and this week’s inflation data—the Consumer Price Index and Producer Price Index—should confirm the direction of interest rates,” reads a summary posted by Sanctuary on LinkedIn.

Payrolls Decline, but Wages Increase

Wage budgets are growing at near-record rates, according to a new corporate survey in the U.S. conducted by The Conference Board.

The report reveals that projected salary budget increases for 2025 are expected at the fastest pace in two decades. Salary increase budgets are a good indicator of the average raise a worker receives in a given year.

On average, employers report planned wage increase budgets of 3.9%, a slight uptick from the actual 3.8% growth in 2024, according to The Conference Board’s US Salary Increase Budgets 2024-2025 report.

“Despite slower hiring and a slight rise in unemployment, elevated wages are expected to persist in 2025. A decline in labor supply is leading companies to focus on retaining their current workforce, resulting in sustained wage increases and higher real wage growth as inflation moderates,” said Dana M. Peterson, Chief Economist at The Conference Board.

The report presents comprehensive survey data from 300 compensation leaders on what companies across the economy are budgeting for annual wage increases.

Kushal Kshirsagar Joins Chicago Atlantic From BlackRock

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Chicago Atlantic has announced the appointment of Kushal Kshirsagar as Managing Partner of Private Wealth Solutions.

Kshirsagar joins from BlackRock and will be responsible for bringing Chicago Atlantic’s private market strategies to individual investors and their advisors, according to company information.

Previously, Kshirsagar held various roles within BlackRock’s Multi-Asset Strategies, U.S. Wealth Advisory, and iShares divisions, including portfolio manager for BlackRock’s U.S. Income Models, lead portfolio strategist for UHNW Wealth Advisory, and Head of Strategy and Business Development for iShares in Asia. Prior to BlackRock, Kshirsagar worked at UBS, Credit Suisse, and Vanguard, and earned a PhD in Finance from UNC – Chapel Hill.

“I was drawn to Chicago Atlantic’s unique combination of underwriting expertise, analytical rigor, proven track record, and entrepreneurial spirit. In a crowded market of undifferentiated private credit strategies competing in the same sponsor-backed club deals, Chicago Atlantic stands out for its sector expertise and focus on markets where there are structural reasons for capital supply shortages,” said Kshirsagar.

This Is How M&G Is Transforming to Become a More Agile and Efficient Organization

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M&G continues to make progress on the three strategic priorities it has set: financial strength, simplification, and growth. This was highlighted during the presentation of its first-half results, where it acknowledged “significant advances in M&G’s transformation, focusing on our strategic priorities” over the past 18 months.

“Despite a challenging market environment in the first half of the year, we have delivered another strong financial performance, with adjusted operating profit and capital generation almost matching last year’s excellent results. Our simplification agenda is advancing well, achieving cost savings of £121 million so far. We have made substantial progress across all our financial goals, and reflecting our strong track record and commitment to solid results for shareholders, we are now announcing upgrades to our capital generation and cost-saving targets,” said Andrea Rossi, Group CEO.

According to Rossi, the firm continues to drive its strategic priorities, “combining the Life and Wealth operations to accelerate our growth plan in the UK retail market. We also see growth opportunities in our international presence and in expanding our product offering,” he noted.

The Transformation of M&G

In its review of the first half of the year, the firm highlighted the good momentum in its Transformation program and noted that they are at the “midpoint” of this three-year initiative to “create a more agile and efficient organization.” To achieve this, “we continue to enhance our ability to respond to customers, reduce costs, and lead growth,” they affirmed.

According to their results, in the first half of 2024, they reduced costs by 4% compared to the same period in 2023, “more than offsetting inflationary pressures and freeing up resources to support investment in growth initiatives, thanks to the £121 million in cost savings since the program’s launch in early 2023,” they clarified.

Following a strategic review and in line with its commitment to operational discipline, they explained that they have decided to focus and streamline their Wealth strategy by combining Life and Wealth operations under the leadership of Clive Bolton. “With this change, we will be better focused on serving the UK retail market, complementing PruFund with life insurance solutions, reducing duplication, and improving efficiency,” they commented.

Regarding their cost reduction plan, they explained that they have raised their target from £200 million to £220 million by 2025, thanks to the progress made so far. “This target increase excludes any additional benefits arising from the streamlining of our operating model announced as part of the half-year results presentation.”

Growth and Outlook

The firm believes it is “successfully navigating a challenging macroeconomic environment.” “We have delivered strong performance while positioning the Group for sustainable long-term growth, focusing on capital-light business models in Asset Management and Life Insurance,” they emphasized.

They argue that the firm is well-positioned to face the current uncertain economic climate due to its diversified business model, international presence, attractive products and services, investment capabilities, and expertise. “The progress made in the first six months of the year supports our continued confidence in meeting our strategic priorities and financial goals, as we remain focused on transforming M&G to deliver excellent outcomes for our clients and shareholders,” they noted.

In this context, the firm reiterated that its priorities are clear: “Maintaining our financial strength, building on the progress already made in simplifying the business, and achieving profitable growth in the UK and internationally.”

Chilean Pension Funds Remain 17% Below Their Pre-Withdrawal Levels

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A little more than four years after the constitutional reform that authorized the first partial withdrawal of pension funds in Chile, the impact is still evident in the pension savings portfolios. According to the Pension Fund Administrators Association (AAFP), pension funds remain below the levels they had in July 2020, when the constitutional change took effect.

At the end of that month, the AFPs managed assets amounting to 214 trillion Chilean pesos (227.3 billion dollars), as stated in a press release. Since then, the system has not been able to return to that figure in any month.

Moreover, by July 2024, the accumulated AUM stood at 177.5 trillion pesos (188.1 billion dollars), which is 17% below the level of pension portfolios held four years ago, according to a study by the Ciedess research center.

In this context, the entity—created by the Chilean Chamber of Construction (CChC), one of the controllers of AFP Habitat—highlighted that the current value of pension funds is equivalent to 82.8% of what was accumulated before the withdrawals.

The deterioration is also evident in relation to the broader economy. Ciedess figures show that the resources managed by the AFPs represented 83% of Chile’s GDP in July 2020, while four years later, that figure had fallen to 62%, marking a 21 percentage point drop in relation to the local GDP.

In total, the three pension fund withdrawals amounted to 44.256 billion dollars, according to the latest data from the Pension Superintendency, involving 28.8 million payment transactions.

Since the third withdrawal window opened in 2021, there have been several attempts to authorize another withdrawal. Last week, Chile’s Chamber of Deputies’ Constitution Commission rejected the latest parliamentary motions proposing new withdrawals, adding to three previous proposals that had already been turned down by the Chilean Congress.

“It is important to clarify that the only way to recover the withdrawn pension funds managed by the AFPs is by replenishing or reintegrating these resources and adding the returns they would have generated from the moment of each withdrawal until the present. As we know, this has not happened, and therefore, the recovery of the fund’s value has not occurred,” explained Rodrigo Gutiérrez, general manager of Ciedess, in the press release.

In this regard, the executive pointed out that “while the third withdrawal included an additional contribution option for this purpose, in practice, its implementation has been almost negligible, and therefore, its intended effect has not been realized.”

UBS to Merge its Wealth Management and Private Banking Divisions in Brazil

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UBS is creating a new business unit, to be called GWM Brazil, which will merge the bank’s Private and Wealth Management areas, according to Bloomberg sources.

GWM Brazil will be jointly led by Luiz Borges and Rafael Gross.

Borges founded Consenso, a multi-family office acquired by the Swiss bank in 2017, while Gross led the client coverage area at Credit Suisse Brazil before the banks’ merger.

According to the report, the internal statement signed by the bank’s Head of Global Wealth Management LatAm, Marcello Chilov, states that the operation aims to “capitalize on the region’s potential and leverage the complementarities” in the businesses.

Luis Bermúdez Appointed as the New CEO of Banco Santander International

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Banco Santander announced to its employees the appointment of Luis Bermúdez as the new CEO of Banco Santander International, the division of International Private Banking in the U.S.

According to an internal statement from the company, the change will be made official in the coming weeks.

Bermúdez has over 20 years of experience in private banking, asset management, brokerage, and investment banking.

He joined Santander in 2005 in Madrid as a Fund Manager, where he stayed until 2010, reaching the position of CIO, Chief of Staff in Madrid. In 2010, he moved to Brazil, where he spent a year before arriving in Miami, according to his LinkedIn profile.

Bermúdez currently holds the position of Global Head of Business Development for Santander Private Banking, based in Miami.

Vanguard Reduces the Minimum Amount Required to Access Its Investment Platform, Digital Advisor

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Vanguard has announced a reduction in the minimum investment amount for its automated investment platform, Digital Advisor, lowering it from $3,000 to $1,001. In doing so, the asset manager aims to expand access to its digital advisory service for investors interested in managing their financial goals online.

Vanguard Digital Advisor, launched in 2020, offers a fully digital financial planning and investment advisory service, providing “personalized, convenient, and low-cost” advice. According to the company, the platform helps clients identify their retirement and non-retirement goals, then designs and manages customized, diversified, and tax-efficient investment portfolios to achieve them. As of June 30, 2024, Digital Advisor manages more than $19 billion in assets.

“Lowering the investment minimum for Vanguard Digital Advisor is an important step in our effort to expand investor access to advice and empower them earlier in their financial journey. We believe that advice strengthens investors’ ability to manage their personal finance and investment needs and can lead to better investment outcomes,” explained Brian Concannon, Head of Vanguard Digital Advisor.

This decision follows a period of accelerated growth and innovation for Digital Advisor, as Vanguard has significantly invested in the customer experience on the platform. Specific improvements include personalized coaching to reach financial goals, a wider selection of portfolios, greater tax efficiency, and the ability to create financial plans as a couple.

“Advice is fundamental to our mission of giving investors the best chance of investment success. We understand that our investors’ needs are constantly changing, and we are committed to continuously evolving and innovating our advice offerings to ensure that clients have the tools, guidance, and most importantly, the access they need to achieve their financial goals,” added Doug Mento, Head of Vanguard Advice.

Adcap Grupo Financiero Appoints Ariel Rivero and Juan Martín Longhi as Co-Heads of International Sales & Trading

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Adcap Grupo Financiero has announced the appointment of Ariel Rivero and Juan Martín Longhi, with over 20 years of combined experience in the financial sector, as the new Co-Heads of International Sales & Trading. According to the firm, this new team will aim to boost Adcap’s growth in global markets, with a strong focus on customer service.

Both professionals have extensive careers. Ariel Rivero, who holds an Executive MBA from IAE, has worked at renowned financial institutions and brokerage firms (ALYCs), excelling on the international trading desk. Regarding his new role, he commented, “I’m pleased with this recognition and the opportunity to continue growing. We hope to take Adcap to the next level and guide the next generation. It’s a great pleasure to share this position with Juan, who is not only an excellent professional but also a friend for many years.”

On the other hand, Juan Martín Longhi has an outstanding track record at the PUENTE trading desk and served as Executive Director of the Sales & Trading area at TPCG Valores. “I’m excited about this new challenge and taking on this role with Ariel, who is an excellent professional. We will develop all the tools needed for Adcap’s Sales & Trading business to grow in volume and improve the service for our clients,” Longhi noted.

Regarding both appointments, Agustín Honig, Managing Partner of Adcap Grupo Financiero, highlighted their importance to the company: “We are very proud to announce the promotion of Ariel Rivero and Juan Martín Longhi as Co-Heads of International Sales & Trading. Both have demonstrated exceptional commitment and leadership over the years at Adcap. I am confident that under their joint leadership, we will continue to expand our presence in global markets and provide top-tier service to our international clients.”

The SEC Accuses Six Credit Rating Agencies of Significant Failures in Record-Keeping

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The Securities and Exchange Commission (SEC) has announced charges against six nationally recognized statistical rating organizations for significant failures by the firms and their staff in maintaining and preserving electronic communications. The firms involved in this action include Moody’s Investors Service, S&P Global Ratings, Fitch Ratings, HR Ratings de México, A.M. Best Rating Services, and Demotech, Inc.

According to the U.S. authority, the firms admitted to the facts outlined in the SEC’s respective orders, acknowledged that their conduct violated the record-keeping provisions of federal securities laws, and agreed to pay civil penalties totaling 49 million dollars. Additionally, all the firms have begun implementing improvements in their compliance policies and procedures to address these violations.

The SEC further clarified in its statement that, with the exception of A.M. Best and Demotech, each credit rating agency is also required to hire a compliance consultant. The SEC recognized that A.M. Best and Demotech made significant efforts to comply with record-keeping requirements early on as registered credit rating agencies and cooperated with the SEC’s investigations, thus they are not required to hire a compliance consultant under the terms of their settlements.

“We have repeatedly seen that failures to maintain and preserve required records can hinder staff’s ability to ensure firms meet their obligations and the Commission’s ability to hold those who fail to meet such obligations accountable, often to the detriment of investors. With these actions, the Commission once again makes it clear that there are tangible benefits for firms that make significant efforts to comply and cooperate with staff investigations,” explained Sanjay Wadhwa, Deputy Director of the SEC’s Division of Enforcement.