Liontrust Asset Management has recruited James Beddall to work alongside Jonathan Hughes-Morgan as co-head of International Sales. Liontrust is in the process of setting up a Branch Office in Luxembourg, where James Beddall is based, subject to appropriate regulatory approvals.
James Beddall joins Jonathan Hughes-Morgan in selling Liontrust’s Dublin range of funds through global banks, private banks, multi-managers and institutional investors internationally, with the primary focus being on Continental Europe. He will market the funds in France, Germany, Italy, Spain, Switzerland, the Benelux and Nordic regions. Jonathan Harbottle, Head of Institutional Sales, will retain responsibility for some clients in continental Europe.
James Beddall, who has 17 years of experience in international sales, has joined Liontrust from F&C Investments where he was Head of International Wholesale Sales. He moved to Thames River Capital in 2007, which was then acquired by F&C in September 2010.
Prior to Thames River, James Beddall was Vice President and Director (from January 2003) of Credit Suisse Asset Management from 2000 to 2007. He joined CSAM to set up the fund sales and distribution in the Benelux region and later on took on responsibility for France, Spain, the UK, the Nordic region and Eastern Europe.
“I am excited about the challenge and opportunity of helping to grow international sales at Liontrust,” says James Beddall. “I was keen to join an asset management business with the desire and potential to grow significantly its international business.
“Liontrust has a strong range of funds and fund managers and we believe there will be demand for the Global Credit and Asia Income teams in particular. I am also looking forward to working again with Jonathan.”
John Ions, Chief Executive of Liontrust, says: “Expanding our sales effort in Continental Europe is the logical next step after the very strong growth in AuM we have generated in the UK over the past four years.
“With the recruitment of James, we have put together a very strong sales team to market our funds internationally. We are also actively looking for more fund management teams that will appeal to the Wholesale market in Continental Europe.”
Foto: Iñakideluis, Flickr, Creative Commons. Encaje de bolillos
The Federal Reserve Board recently reported that almost half of Americans have not begun planning for retirement. Wilde Wealth Management Group is teaming up with Retirement Consultants to change that, expanding their reach across Arizona to encourage more corporate employees to prepare for retirement.
Both firms are licensed to advise clients on 401(K) accounts in addition to other financial services, and many of their clients work for major Arizona employers such as CenturyLink, Intel, Raytheon, Tucson Electric, and the Arizona universities. Both firms are hosting information sessions and meeting with employees individually at their workplaces to inspire them and help them plan.
Trevor Wildeof Wilde Wealth, based in the Phoenix area, says, “If your employer offers 401(K) matching, that’s a no-brainer. It’s a great place to start. From there, we personalize the rest of your financial plans to prepare for your individual needs and goals. Having a consistent review process with each client is a vital element of our practice.”
Michael Santoroof Retirement Consultants, based in the Tucson area, says, “As they say, most people don’t plan to fail; they fail to plan. For many people, their employer-sponsored retirement plan comprises the largest portion of their nest egg, yet they don’t give it the care and thought it deserves. Most don’t even realize how many choices they have. Then, as employees enter their 50s, it’s like the red zone in football—those last 20 yards where you want to focus on a strategic plan and avoid fumbling. It is critical to plan, coordinating all your financial decisions to work as a team for that final run.”
The Federal Reserve Board, in its latest annual “Report on the Economic Well-Being of U.S. Households” reported, “Almost half of respondents had not planned financially for retirement. . . . 31 percent of respondents reported having no retirement savings or pension, including 19 percent of those ages 55 to 64, and 25 percent didn’t know how they will pay their expenses in retirement.”
S&P Dow Jones Indices and RobecoSAM, the investment specialist focused exclusively on Sustainability Investing, announced the results of the annual Dow Jones Sustainability Indices review. This year marks the 15 year anniversary of the DJSI.
Launched in 1999, the DJSI World is the first global index to track the financial performance of the leading sustainability-driven companies worldwide based on an analysis of financially material economic, environmental, and social factors. The three largest additions (by free-float market capitalization) to the DJSI World this year include Amgen Inc, Commonwealth Bank of Australia and GlaxoSmithKline PLC and deletions include Bank of America Corp, General Electric Co and Schlumberger Ltd.
Guido Giese, Head of Indices, RobecoSAM: “We are proud to celebrate 15 years of providing investors with sophisticated benchmarks for corporate sustainability. Since 1999, we have helped investors realize the financial materiality of sustainability and companies continue to tell us that the DJSI provides an excellent tool to measure the effectiveness of their sustainability strategies. In 15 years, the total number of companies we assess has more than quadrupled. We have also developed new sustainability benchmarks for investors such as country and regional indices.”
David Blitzer, Managing Director and Chairman of the S&P Dow Jones Index Committee: “Both the importance and the understanding of sustainability has grown dramatically over the past decade and a half. During that time the Dow Jones Sustainability Indices have been established as the leading benchmark in the field. S&P Dow Jones Indices is pleased to work with RobecoSAM in combining S&P DJI’s experience with indices and RobecoSAM’s expertise in assessing corporate sustainability programs.”
RobecoSAM recognizes the following companies for being in the DJSI World all 15 years:
The DJSI follow a best-in-class approach, including companies across all industries that outperform their peers in numerous sustainability metrics. Each year over 3,000 companies, including 800 companies from emerging markets, are invited to participate in RobecoSAM’s Corporate Sustainability Assessment, which provides an in-depth analysis of financially material economic, environmental, and social practices.
Following this assessment, RobecoSAM identifies the top company in each of the 24 industry groups (according to GICS):
Daniel Ivascyn, nuevo CIO de PIMCO. Foto cedida. Sensación de alivio y emoción “abrumadora” en PIMCO tras la salida de Bill Gross
PIMCO has elected Daniel Ivascyn to serve as Group Chief Investment Officer (“Group CIO”), succeeding William H. Gross who has left the firm. In addition, the firm appointed Andrew Balls, CIO Global; Mark Kiesel, CIO Global Credit; Virginie Maisonneuve, CIO Equities; Scott Mather, CIO U.S. Core Strategies; and Mihir Worah, CIO Real Return and Asset Allocation. Douglas Hodge, PIMCO’s Chief Executive Officer, and Lew “Jay” Jacobs, President, will continue to serve as the firm’s senior executive leadership team, spearheading PIMCO’s business strategy, client service and the firm’s operation.
The firm also appointed Mr. Mather, Mr. Kiesel and Mr. Worah as Portfolio Managers for the Total Return Fund. Saumil Parikh, Mohsen Fahmi, and Mr. Ivascyn will serve as Portfolio Managers for the Unconstrained Bond Fund. As Group CIO, Mr. Ivascyn will continue to oversee the firm’s alternatives strategies, structured credit, and income strategies. Chris Dialynas, Managing Director and Portfolio Manager, will return to the firm from sabbatical during the fourth quarter of 2014. These changes and appointments are effective immediately.
Said Mr. Hodge: “As part of our responsibilities to our clients, employees and parent, PIMCO has been developing a succession plan for some time to ensure that the firm is well prepared to manage a seamless leadership transition in its Portfolio Management team. We have passed the torch of leadership to a team of investors who are among the very best in the investment management industry. They are seasoned, highly skilled professionals who embody PIMCO’s values and have established track records of delivering value to clients.”
Mr. Hodge continued: “Today’s announcement marks the completion of our portfolio management succession process. These appointments are a continuation of the structure that PIMCO established earlier in 2014 and they reflect our long-held belief that the best approach for PIMCO’s clients and our firm is to evolve our investment leadership structure to a team of seasoned, highly skilled investors overseeing all areas of PIMCO’s investment activities.”
Said Mr. Ivascyn: “We have assembled a team of world-class investors over the course of many years, and established a time-tested top-down, bottom-up investment process that will guide our investment philosophy and continue to serve our clients well into the future. Our CIO’s and I are fully committed to consistently deliver to our clients the investment excellence that they have rightly come to expect of us.”
Under this leadership structure, Mr. Balls and Mr. Worah have additional managerial responsibility for PIMCO’s Portfolio Management group and trade floor activities globally. Mr. Balls will oversee Portfolio Management in Europe and Asia-Pacific, and Mr. Worah will oversee Portfolio Management in the U.S.
Said Michael Diekmann, Chief Executive Officer of Allianz Group: “Since becoming part of the Allianz Group in 2000, PIMCO has grown enormously and contributed consistently to Allianz’s success. We join our PIMCO colleagues in recognizing Bill Gross for his accomplishments over the 43 years since PIMCO’s founding. We wish Bill good luck. The management and investment structure put in place in January as well as the thorough succession planning gives us complete confidence in PIMCO’s investment and executive leadership team.”
Said the Independent Trustees for PIMCO’s fixed income and equity mutual funds and the Chairman of PIMCO’s closed-end funds: ”We are “fully supportive of PIMCO, its executive leadership and its portfolio management teams. They have our complete confidence.”
Mr. Ivascyn added: “We have a deep bench of talent with extensive investment and leadership experience, including more than 240 portfolio managers globally, and our outstanding team around the world gives us the scale, talent, expertise and commitment to manage this transition. We will continue to add and promote talent at all levels to help us drive our firm forward.”
Professional biographies (in alphabetical order):
Andrew Balls Mr. Balls is CIO Global, a managing director in the London office and a member of the Investment Committee. He is head of European portfolio management, leading PIMCO’s European investment team (which is based in London and Munich), and he also oversees PIMCO’s investment teams in the Asia Pacific region. He manages a range of global and European portfolios, including PIMCO’s Global Advantage strategy, combining developed and emerging fixed income markets. Mr. Balls was previously a portfolio manager in Newport Beach and the firm’s global strategist. Prior to joining PIMCO in 2006, he spent eight years at the Financial Times as an economics correspondent and columnist in London, New York and Washington, DC. He has 16 years of investment experience and holds a bachelor’s degree from Oxford and a master’s degree from Harvard University. He was a lecturer in economics at Keble College, Oxford.
Chris Dialynas Mr. Dialynas is a managing director in the Newport Beach office, a portfolio manager, and a member of PIMCO’s Investment Committee. He has written extensively and lectured on the topic of fixed-income investing. Mr. Dialynas served on the editorial board of The Journal of Portfolio Management and was a member of the Fixed Income Curriculum Committee of the Association for Investment Management and Research. He has 36 years of investment experience and holds an MBA from the University of Chicago Graduate School of Business. He received his undergraduate degree from Pomona College. He joined PIMCO in 1980.
Mohsen Fahmi Mr. Fahmi is a managing director and generalist portfolio manager in the Newport Beach office, focusing on global fixed income assets. Prior to joining PIMCO in 2014, he was with Moore Capital Management, most recently as a senior portfolio manager and previously as chief operating officer. In London earlier in his career, he was co-head of bond and currency proprietary trading at Tokai Bank Europe, head of leveraged investment at Salomon Brothers and executive director of proprietary trading at Goldman Sachs. Prior to this, he was a proprietary trader for J.P. Morgan in both New York and London, and he also spent seven years as an investment officer at the World Bank in Washington, DC. He has 30 years of investment experience and holds an MBA from Stanford University. He received a master’s degree in civil engineering from the Ohio State University and an undergraduate degree from Ain Shams University, Cairo.
Daniel J. Ivascyn Mr. Ivascyn is Group CIO, and a managing director in the Newport Beach office. He is the head of the mortgage credit portfolio management team and a lead portfolio manager for PIMCO’s credit hedge fund and mortgage opportunistic strategies. Mr. Ivascyn is a member of PIMCO’s Executive Committee and a member of the Investment Committee. Morningstar named him Fixed-Income Fund Manager of the Year (U.S.) for 2013. Prior to joining PIMCO in 1998, he worked at Bear Stearns in the asset-backed securities group, as well as T. Rowe Price and Fidelity Investments. He has 23 years of investment experience and holds an MBA in analytic finance from the University of Chicago Graduate School of Business and a bachelor’s degree in economics from Occidental College.
Mark R. Kiesel Mr. Kiesel is CIO Global Credit and a managing director in the Newport Beach office. He is a member of the PIMCO Investment Committee, a generalist portfolio manager and the global head of corporate bond portfolio management, with oversight for the firm’s investment grade, high yield, bank loan, municipal and insurance business as well as credit research. Morningstar named him Fixed-Income Fund Manager of the Year in 2012 and a finalist in 2010. He has written extensively on the topic of global credit markets, founded the firm’s Global Credit Perspectives publication and regularly appears in the financial media. He joined PIMCO in 1996 and previously served as PIMCO’s global head of investment grade corporate bonds and as a senior credit analyst. He has 22 years of investment experience and holds an MBA from the University of Chicago’s Graduate School of Business. He received his undergraduate degree from the University of Michigan.
Virginie Maisonneuve, CFA Ms. Maisonneuve is CIO Equities, managing director, global head of equities and portfolio manager based in the London office. Prior to joining PIMCO in 2014, she was head of global and international equities at Schroders plc. Previously, she was co-CIO and director at Clay Finlay, a portfolio manager at State Street Research and Management, and a portfolio manager at Batterymarch Financial Management. She has 27 years of investment experience and holds an MBA from the Ecole Superieure Libre des Sciences Commerciales Appliquees (ESLSCA) in Paris. She also holds a master’s degree in Mandarin Chinese from Dauphine University in Paris and an undergraduate degree from People’s University (Renda) in Beijing.
Scott A. Mather Mr. Mather is CIO U.S. Core Strategies, and a managing director in the Newport Beach office and head of global portfolio management. Previously, he led portfolio management in Europe, managed euro and pan-European portfolios and worked closely with many Allianz-related companies. He also served as a managing director of Allianz Global Investors KAG. Prior to these roles, Mr. Mather co-headed PIMCO’s mortgage- and asset-backed securities team. Prior to joining PIMCO in 1998, he was a fixed income trader specializing in mortgage-backed securities at Goldman Sachs in New York. He has 20 years of investment experience and holds a master’s degree in engineering, as well as undergraduate degrees, from the University of Pennsylvania.
Saumil H. Parikh, CFA Mr. Parikh is a managing director in the Newport Beach office and generalist portfolio manager. Mr. Parikh is also a member of the PIMCO Investment Committee and leads the firm’s cyclical economic forums. He previously served as a specialist portfolio manager on the short-term, mortgage and global portfolio management teams. Prior to joining PIMCO in 2000, Mr. Parikh was a financial economist and market strategist at UBS Warburg. He has 15 years of investment experience and holds undergraduate degrees in economics and biology from Grinnell College.
Mihir P. Worah Mr. Worah is CIO Return and Asset Allocation, and a managing director in the Newport Beach office, a portfolio manager, and head of the real return and multi-asset portfolio management teams. Prior to joining PIMCO in 2001, he was a postdoctoral research associate at the University of California, Berkeley, and the Stanford Linear Accelerator Center, where he built models to explain the difference between matter and anti-matter. In 2012 he co-authored “Intelligent Commodity Indexing,” published by McGraw-Hill. He has 12 years of investment experience and holds a Ph.D. in theoretical physics from the University of Chicago.
Foto cedida. Hispania adquiere el hotel Meliá Jardines del Teide, en Tenerife
Hispania, through its subsidiary Hispania Real SOCIMI, S.A.U., has acquired the Meliá Jardines del Teide hotel for an amount of 36.7 million Euro, fully disbursed with Hispania’s own funds.
Meliá Jardines del Teide is a 4* hotel with 300 keys located in Costa Adeje, the most exclusive area in the South of Tenerife, in the Canary Islands. The hotel, which has more than 12,000 sqmof gardens with local species and terraces, is located in the surroundings of Playa del Duque beach and offers plenty of complimentary services, such as 3 swimming pools with solarium, bars and restaurants, 3 conference rooms with capacity for up to 450 people, discos and squash courts.
The hotel is currently operated under a rental contract and is managed by the hotel group Meliá. Hispania’s strategy for this asset contemplates an investment plan for its repositioning within Costa Adeje. Once this capex investment takes place, Meliá will remain as the hotel’s operator.
“The Canary Islands and, more specifically, the South of Tenerife, is one of the most relevant touristic destinations in Europe and it enjoys a relatively stable affluence of tourists all year round. The acquisition of a high quality asset such as the Meliá Jardines del Teide hotel fits perfectly within our strategy of investment in consolidated holiday destinations and it offers a repositioning potential which we expect to materialize with our business plan”, asserts Concha Osácar, Board Member of Hispania.
With this deal, Hispania has already invested 347 million Euro, 65.2% of the net proceeds raised in its IPO last March 14th, building a portfolio which includes a Gross Leasable Area of 91,218 sqm of offices in Madrid and Barcelona, 412 dwellings -213 in Barcelona and 199 in Madrid-and4 hotels totalling 639 keys, one in Marbella, two in Madrid region and this last one in Tenerife.
Foto: Arild Vågen . BOCHK AM y Citi lanzan un vehículo UCITS high yield en renminbis
Bank of China (Hong Kong) Asset Management (BOCHK AM) and Citigroup Global Markets have jointly launched the BOCHK RMB High Yield Bond Fund. This is BOCHK’s first Renminbi (RMB) high yield bond UCITS Fund registered in Luxembourg. The Fund aims to generate long-term capital growth and income by investing mainly in debt securities which are either denominated in RMB, hedged to this currency or have other exposure to this currency, giving investors the potential for investment returns from RMB fixed income investments and RMB currency appreciation.
BOCHK AM is one of the largest active RMB fund managers globally, with discretionary and advisory mandates of USD 7.7 billion. BOCHK AM first launched an RMB high yield bond fund in August 2011, which has produced an average return of 15.2% per annum over the past 3 years. Citi’s Markets and Securities Services business has collaborated with BOCHK AM to launch the new UCITS Fund. Citi and BOCHK AM will act as the Fund’s distributors, while BOCHK AM will take the role of investment manager, and Citibank International (Luxembourg Branch) is the Fund’s administrator and custodian.
The Fund benefits from BOCHK AM’s expertise and experience in investing in the RMB high yield market, leveraging BOCHK AM’s onshore and offshore China market insights. BOCHK AM has the full support of Bank of China (Hong Kong) Limited, the sole RMB clearing bank and a major RMB participating bank in Hong Kong. The Fund provides a highly liquid solution for those investors looking to deploy capital into the growing RMB markets and seeking participation in the ongoing internationalization of the currency. The Fund also builds on the growing importance of Luxembourg as a key investment centre for RMB, with RMB262 billion5 (USD42 billion) of assets held in Luxembourg-domiciled funds linked to RMB.
The Bank of China Group has been present in Luxembourg since 1991. Citi first opened for business in Luxembourg in 1970, and today provides a full range of Investor Services products to UCITS and non-UCITS clients including global custody, fund accounting, transfer agency, corporate secretarial, securities lending and depositary bank services.
Dr. AU King Lun, Chief Executive Officer of BOCHK AM, said, “The Fund launch is a major milestone for BOCHK AM. Our strategic collaboration with Citi highlights the growing importance of RMB bonds as a new asset class for investors globally.”
“Citi is delighted to work with BOCHK AM to facilitate global investors in accessing a world-class solution to gain exposure to the RMB fixed income marketplace.
BOCHK AM’s insights, delivered via the UCITS format with associated benefits and safeguards, represents a timely and exciting investment proposal for a wide range of global investors,” said Mr. Eric Personne, EMEA Head of Citi’s Multi-Asset Group.
Foto: Robert Weißenberg. El optimismo de los inversores de EE.UU. está en su nivel más alto desde 2007
The Wells Fargo/GallupInvestor and Retirement Optimism Index jumped to +46 in the third quarter, its highest level in seven years. The index is up 17 points from the second quarter’s +29, with most of the gains stemming from investors’ heightened optimism about economic growth and the labor market. While the optimism index is at its highest point since December 2007, it remains well below the pre-2008 recession 12-year average of just under +100.
Optimism among non-retired investors jumped almost 20 points to +50 while the optimism of retired investors rose 11 points to +35. The Wells Fargo/Gallup quarterly survey measures the perceptions of U.S. investors with $10,000 or more in investable assets; results are based on phone interviews with 1,011 investors, aged 18 and older, from Aug. 15-24.
“Investors are saying they’re more optimistic about the economy and the job market. But non-retirees worry about their ability to earn more in their lifetime, and they are skeptical the stock market is the place for them to grow their savings,” said Karen Wimbish, director of Retail Retirement at Wells Fargo. “Clearly, average investors have not forgotten their recession experiences.”
Investors Tread Water Financially and Feel the Effects of Inflation
Looking to the future, the majority of non-retired investors expect their income to be stagnant: 56 percent say they do not foresee a time when “their income will be significantly higher than it is today” as compared to 42 percent who do foresee potential for growth in income.
Non-retirees with $100,000 or more in assets are especially pessimistic about the prospect of earning more: 61 percent say they do not foresee a time when their income will be significantly higher than it is today, compared with 51 percent of investors who have less than $100,000 in assets.
“Investors with higher assets appear to feel as if they’ve hit a ceiling. They have done well, but don’t see opportunity for continued income gains in the future,” Wimbish said.
When asked how their finances today compare to five years ago, a majority (58%) say they are doing “about the same” (34%) or “worse” (24%) than five years ago, while 42 percent say they are “doing better.” Similarly, just 37 percent say they are saving and investing more money in recent months than they did prior to the recession. A majority (63%) says they are saving “about the same” (34%) or “less” (29%). These figures are essentially unchanged from two years ago, indicating that investors have not been able to make much financial headway in the economic recovery.
When asked directly about the impact the 2008 recession has had on their finances, nearly half (46%) say they are still feeling the effects of the recession “a lot” (19%) or a “fair amount” (27%). Another 31% only feel its impact “a little,” while 22 percent say “not at all.”
In the midst of the national conversation about wage stagnation, half of investors (51%) think the pressure on American families’ ability to save today is due to rising prices caused by inflation, whereas about four in 10 (37%) say the pressure is caused by lack of wage growth or stagnation. Nine percent of investors say the pressure is caused by a combination of the two factors.
Caution Towards Stock Market Deemed “Wise” by Majority
A new Wells Fargo/Gallup question this quarter asked investors whether they think caution toward investing in the stock market is “wise because it protects people from possible market losses,” or “unwise because it prevents people from realizing significant market gains.” Sixty percent of all investors say such caution is “wise” while 37 percent call it “unwise, because it prevents investors from realizing significant market gains.”
In the poll, 68 percent of investors say they “actively choose stocks for their long-term investment accounts,” but almost a third (29%), say they “consciously avoid stocks in long-term investment accounts.” When respondents are divided between those with $100,000 or more in assets and those with less, 42 percent of those with less than $100,000 in assets say they “consciously avoid stocks in long-term investment accounts,” versus 20 percent of those with more than $100,000 in assets.
Of the 29 percent of all investors who say they consciously avoid stocks, less than half (41%) feel confident they can reach their financial goals without stock market exposure. The majority (56%), say they are notconfident they can reach their financial goals without taking on stock market risk, but they still think it’s better to avoid that risk.
“The fact that nearly seven out of ten say they choose stocks for their long term investing is a good strategy for growing assets over time, and yet it’s noteworthy that nearly a third actively choose to avoid stocks for long term accounts. And, this active avoidance is even more pronounced for people with fewer assets – these investors could stand to gain in the market through a long-term, gradual investing strategy and they seem to know it but they think avoiding risk is more important,” said Wimbish.
While most investors say they actively choose to include stocks in their long-term investment accounts, they may not be allocating enough to stocks. On average, investors say that 38 percent of their retirement savings are invested in the stock market. Naturally, this is lower among retirees, at 33 percent, but not much lower than among non-retirees, who say they have 40 percent invested in stocks.
Relatedly, in sharp contrast to the common recommendation that investors’ scale their exposure to the stock market by age, the survey finds little difference in the average percentage of retirement savings that investors of various ages say they have invested in the stock market. This average is 33 percent among all retirees, 39 percent among non-retirees aged 18 to 49, and 41 percent among non-retirees aged 50 to 64.
Retirement Confidence Hinges on Social Security
Taking their savings and Social Security income into consideration, a majority (69%) of investors say they are “highly” or “somewhat” confident they will have enough money to maintain their desired lifestyle throughout their retirement years.
However, nearly half (46%) are “very” or “somewhat” worried about outliving their savings, including 50 percent of non-retirees and 36 percent of retirees. Retirees who run out of money could become entirely dependent on their Social Security checks.
“Clearly Social Security plays a key role in thinking about retirement income, and concerns about the government’s ability to address the system’s financial problems exist for both retirees and non-retirees,” said Wimbish.
Six in 10 (58%) don’t think federal lawmakers will address the financial problems with Social Security in time to preserve the system for future retirees. Two-thirds of younger investors (67%), those under age 50, are especially pessimistic, saying lawmakers will not fix the system. These same investors are also much more doubtful than older ones that they will ultimately receive their full or even slightly reduced benefits in retirement. A little more than a third (38%) of investors between the ages 18 to 49 believe they will get most or all of the benefits due to them under the current system, compared to 71 percent of those between the ages 50 and 64, and 73 percent among those 65 and older.
Despite these divergent perceptions about whether Social Security will be there for them in retirement, non-retirees on average expect Social Security to account for 26 percent of their annual retirement income, while retirees, on average, report that it currently accounts for 30 percent of their retirement funding.
Citi Private Bank announced that Tracey Brophy Warson has been named Head of Citi Private Bank in North America. Ms. Warson succeeds Peter Charrington, who was recently named Global Head of Citi Private Bank. Ms. Warson will report to Mr. Charrington and be based in New York. She will be a member of the Private Bank Global Leadership Team.
“Since joining Citi Private Bank in 2010, Tracey has done a remarkable job growing our footprint on the West Coast. Since that time, she has significantly increased revenues and AUMs and built an exceptional team of private bankers and specialists who are doing a superb job serving the fast growing number of ultra high net worth clients in that market,” said Mr. Charrington. “We are excited by this appointment and look forward to her leadership in North America.“
Ms. Warson has nearly 30 years of experience working with ultra high net worth individuals, families and institutions. She was most recently Western Region Market Manager for Citi Private Bank in North America. In this role she oversaw ultra high net worth banking offices in Beverly Hills, Los Angeles, Orange County, Palo Alto, San Francisco, Phoenix and Seattle. Before joining Citi, Ms. Warson served as West Division Executive for US Trust, Bank of America Private Wealth Management where she built and ran the Western Region. Prior to joining US Trust she was Executive Vice President and Regional Managing Director of Private Client Services at Wells Fargo Private Bank. In this role she was responsible for Wells Fargo’s investment management, trust, private banking, wealth planning and brokerage businesses in the Bay Area. Previously Ms. Warson served as an Executive Vice President and Head of Sales and Distribution for Wells Fargo’s foreign exchange and financial risk management businesses nationally. Ms. Warson worked in the investment banking division of Citi in Los Angeles and started her career in banking as an International Banking Officer at Toyo Trust & Banking Company in Los Angeles.
Ms. Warson earned her BA in Business Administration and French from the University of Minnesota. She also completed a fellowship at the Université de Tours, in Tours, France. Ms. Warson has repeatedly been named one of “The Most Influential Women in Bay Area Business” by the San Francisco Business Times.
A continued economic recovery, strong equity market performance, rising real estate values, and an “energy renaissance” that pushed U.S. oil production to its highest levels in over 20 years, boosted the population and wealth of High Net Worth Individuals(HNWIs) in the U.S. to record levels in 2013, according to the U.S. Wealth Report 2014 released by Capgemini and RBC Wealth Management.
The population of U.S. HNWIs jumped 17 percent to 4 million and their investable wealth by 18 percent to reach $13.9 trillion. Growth rates of both the HNWI population and HNWI wealth in the U.S. exceed the global averages of 15 percent and 14 percent respectively.
“Steady GDP growth, reduced unemployment, a falling deficit, and an energy renaissance boosted investor confidence and energized risk appetites in 2013,” said John Taft, Chief Executive Officer, RBC Wealth Management – U.S. “These factors contributed to record wealth levels in the U.S. Over the last five years, some of the strongest growth in wealth occurred in the energy and technology-centric cities of Dallas, Houston and San Jose, indicating that a broader mix of geographies and industries is driving wealth creation in the U.S.”
Twelve cities are home to the majority of U.S. HNWIs
Growth in U.S. HNWI wealth was driven by the top 12 cities by HNWI population – New York, Los Angeles, Chicago, Washington D.C., San Francisco, Boston, Philadelphia, Houston, San Jose, Dallas, Detroit, and Seattle – which are home to more than two-thirds (69 percent) of U.S. HNWIs and three-quarters (75 percent) of U.S. HNWI wealth.
While New York still reigns, holding almost three times more HNWIs (at 894,000) and wealth ($3.2 trillion) than second-ranked Los Angeles (at 330,000; $1.2 trillion), it recorded the second lowest growth rate (12 percent) in HNWI population of the top 12 MSAs, ranking only slightly higher than Detroit (11 percent).
Tech and energy-centric cities increasingly leading HNWI population and wealth growth
The Texas cities of Dallas and Houston were stand-outs, leading in both HNWI population growth – at 20 percent and 18 percent respectively – and wealth growth, at 24 percent and 22 percent respectively. In fact, Dallas entered into the top 10 HNWI population centers for the first time, edging out Detroit.
While HNWI wealth remains mostly concentrated along the East and West coasts, the report notes that, between 2008-2013, three of the four fastest-growing cities in HNWI population and wealth have been those with ties to energy – in the case of Dallas and Houston, and technology – in the case of San Jose, pointing to a new pattern of HNWI wealth creation in the U.S.
Greater risk-taking supported by surging trust in wealth industry
According to the report’s Global HNW Insights Survey, U.S. HNWIs’ trust in all aspects of the wealth management industry surged by double-digit rates between early 2013 and early 2014. Trust in wealth managers and firms increased 12 percentage points each to 84 percent and 87 percent respectively, putting U.S. HNWIs well above their peers in the rest of the world (71 percent and 72 percent respectively).
Increased trust supported a greater appetite for risk, with allocations to alternative investments up by four percentage points to 13 percent of portfolios, while equity allocations remained the highest across the globe at one-third of portfolios (and up to 41 percent in Washington D.C., highest in the U.S.). U.S. HNWIs were also more inclined to invest beyond North American borders, with their international allocations up to 33 percent in early 2014 from only 20 percent of portfolios a year earlier. This trend was particularly driven by HNWIs aged under 40 who invested 53 percent of their wealth in foreign markets.
Despite increased trust in wealth managers, HNWIs’ assessment of wealth manager performance dropped by six percentage points to 73 percent, though remains much higher than the rest of the world average of 59 percent. Declining scores signal opportunities for firms to reposition their offerings to meet specific HNWI preferences, especially for HNWIs under 40 versus their counterparts aged 60 and over.
Younger HNWIs are more likely to classify their needs as complex (38 percent vs. nine percent), seek family wealth advice (35 percent vs. 13 percent) and demand digital (internet, mobile, email) contact over direct personal contact (39 percent vs. 15 percent). Given the strong preference for digital interactions, wealth management firms will need to take proactive steps to meet increasing demands in this area.
“There is great opportunity for wealth management firms to reposition and strengthen their offerings in response to declining performance scores,”said Jean Lassignardie, Chief Sales and Marketing Officer, Capgemini Financial Services. “One way to respond to clients is by developing an integrated channel experience that not only maintains their wealth manager relationship but enhances it through digital enablement.”
As U.S. HNWIs expressed a pronounced preference to work with a single firm (54 percent vs. 11 percent multiple firms), firms that work with them will need to continue to deliver against the specific needs of their clients to drive high satisfaction levels.
Younger and female HNWIs could signal shift in causes supported by U.S. wealth
Making a positive impact on society through investing time, money or expertise is important to the vast majority (88 percent) of U.S. HNWIs and extremely or very important to 56 percent. HNWIs under 40 are particularly focused on driving social impact, with 81 percent citing driving social impact as extremely or very important.
Younger HNWIs also favor different causes than their older peers (aged 60 and over), citing social programs, race relations, gender inequality, energy security and unemployment as their top five priorities, while their older counterparts favor child welfare, education, and health. Given the rising wealth among younger HNWIs, there could be a shift in the types of social issues that get the most attention in the U.S. moving forward.
Female HNWIs are likely to have a greater influence on driving social impact going forward. As with younger HNWIs, female HNWIs place great value on driving social impact, with 62 percent citing it as extremely or very important, compared to 50 percent of male HNWIs.
Guggenheim Partners has announced the hiring of Gerald A. Donini as a Senior Managing Director. Mr. Donini will work closely with senior management to identify and develop business opportunities for the firm.
“We are pleased to welcome Jerry to our team,” said Alan Schwartz, Executive Chairman of Guggenheim Partners and CEO of Guggenheim Securities. “Jerry’s reputation as a leader and his expertise in building markets platforms will enhance our ability to scale our businesses. Moreover, Jerry is a perfect fit with our team-oriented culture.”
“I am excited about the business that Alan and the team at Guggenheim are building,” Mr. Donini said. “In a short time, Guggenheim has emerged as a highly respected partner known for its client service and differentiated approach within the securities industry. That recognition and trust from the clients provide us with a great foundation to move forward.”
Mr. Donini was most recently the Chief Operating Officer of Barclays Global Corporate and Investment Banking. Prior to that, he served as the Global Head of Equities at both Lehman Brothers and Barclays. Mr. Donini served on both firms’ Executive Committees.
He graduated with a B.A. in Economics from Brown University.
