Wikimedia CommonsPhoto: Nasa. Mexico Amends the Investment Regime for Afores
Last April, the governing bodies of the National Commission of Savings System for Retirement (CONSAR) approved amendments to the Investment Plan to which the Investment Company Specialized Retirement Funds (SIEFORES)are subject.
Because of this, and in order to establish the investment regime by which the Siefores must abide, last Tuesday the Ministry of Finance and Public Credit (SHCP) in Mexico published in the Official Journal of the Federation (DOF), the general provisions which establish the investment regime by which investment companies specialized in retirement funds must abide.
According to a statement made to Funds Society by CONSAR sources, “these modifications allow for the consolidation of international diversification opportunities and strengthen investment risk control.”
The amendments are:
To Make countries which belong to the Committee on the Global Financial System (CGFS)of the Bank for International Settlements (BIS) eligible for SIEFORE international investments, overruling the requirement to be a member of the Technical Committee of IOSCO for these purposes. According to Consar, the modification guarantees that the highest standards of regulation and supervision of international markets in which the SIEFORE are involved, are maintained.
To add “South Korea” and “Singapore” to the group of eligible countries, as these “have shown great economic dynamism, financial markets which are effectively regulated and monitored, and have a remarkable level of development which favors diversification and profitability of resources”.
The changes made to the provisions of the Investment Regime, also adjust the risk management tool which is used to monitor the volatility and risk of the investment portfolio. “Therefore, it seeks to limit the volatility of this tool, known as the Differential of the Conditional Value at Risk, so as to eliminate the factors that made it pro-cyclical, which means that investors who used it could contribute to amplify market volatility or, otherwise, in times of stability, investors could act complacent without prudently limiting the risks. In this way, the AFORES will invest more prudently, thus contributing to the security of pensioners’ resources”, concluded the Commission.
The maximum limit of 20% laid down by law for investments in international markets shall remain intact, as well as the asset classes previously permitted, which can be seen in the following table:
Wikimedia CommonsCarstens, president of the BIS Economic Cosultative Committee and the BIS Global Economy Meeting.. Agustín Carstens, New President of the BIS Economic Cosultative Committee and the BIS Global Economy Meeting
Agustín Carstens has been appointed to chair the BIS Economic Consultative Committee and the BIS Global Economy Meeting. Mario Draghi has also been appointed to chair the Group of Governors and Heads of Supervision.
Two appointments have recently been made at the Bank for International Settlements (BIS), both with effect from 1 July 2013 and for a three-year term:
The BIS Board of Directors has appointed Agustín Carstens, Governor of the Bank of Mexico, as Chairman of the Economic Consultative Committee (ECC) and the Global Economy Meeting (GEM) after consultations with members of the GEM.
The Group of Governors and Heads of Supervision (GHOS) has selected Mario Draghi, President of the European Central Bank, as its new Chair after consultations among its members.
Agustín Carstens and Mario Draghi will succeed Mervyn King, who will step down as Chairman of the three groups when he retires as Governor of the Bank of England at the end of June. Mr King has chaired the ECC, the GEM and the GHOS since November 2011.
Both the Board and the GHOS have expressed their gratitude for Mr King’s excellent chairmanship.
Wikimedia CommonsFoto: Ascent Private Capital Management. Karen McNeill, nueva jefa de Historia Familiar de Ascent Private Capital
U.S. Bank Wealth Management announced today that Karen McNeill has been appointed Head of Family History for Ascent Private Capital Management of U.S. Bank. Karen reports to Scott Winget, Senior Managing Director of Wealth Impact Planning.
“Karen is passionate about history and believes that it is important to help us understand ourselves and the world in which we live,” Winget said. “We are delighted to have such a distinguished professional join our Wealth Impact Planning team.”
In her new role, McNeill works directly with families to research and present family and business histories as part of a comprehensive wealth planning platform. As part of Ascent’s Wealth Impact Planning team, she helps families uncover and construct meaningful family histories, then delivers them in live presentations, often at family meetings or retreats.
McNeill has more than 15 years of experience in working on personal history projects with individuals, as well as with private and public sector organizations. Prior to joining Ascent, she taught history at the University of California, Berkeley, the University of the Pacific, Ohlone College, and the Academy of Art University. She has also served as senior historian/architectural historian at Carey & Co., Inc., in San Francisco, where she was a consultant for many private and highly public individuals. She has also been a consultant to Landmarks California and is a Director on the Landmark Heritage Foundation Board.
McNeill earned Ph.D., M.A., and B.A. degrees in history from the University of California, Berkeley. She has authored a variety of publications and earned a number of honors and awards, including a research fellowship from the National Endowment for the Humanities for her biography of Julia Morgan, architect for the Hearst family.
ETFs and ETPs have received record net inflows of $107 billion through the end of May 2013 which is 31% higher than the $82 billion in net flows at this time in 2012. These inflows have helped to push assets invested globally in Exchange Traded Funds (ETFs) and Exchange Traded Products (ETPs) to a new all-time high of $2.14 trillion US dollars, according to preliminary figures from ETFGI’s Global ETF and ETP industry insights report for May 2013. There are now 4,849 ETFs and ETPs, with 9,875 listings, assets of $2.14 trillion, from 211 providers listed on 56 exchanges. ETF and ETP assets have increased by 9.6% from $1.95 trillion to $2.14 trillion.
ETFs and ETPs in May received $24.3 billion in net inflows. Equity ETFs and ETPs gathered the largest net inflows with $25 billion, followed by fixed income ETFs and ETPs with $3.1 billion, while commodity ETFs and ETPs experienced net outflows with $6.7 billion.
Equity ETFs and ETPs saw net inflows of $25 billion in May with US/North American equity exposures gathering $16 billion, the largest net inflows, followed by developed Asia Pacific equity with $8.9 billion, and global equity with $2.1 billion net inflows, while products offering emerging market equity exposure experienced the largest net outflows with $4.3 billion.
Fixed income ETFs and ETPs gathered net inflows of $3.1 billion in May and were composed of $2.2 billion of net inflows into corporate bond products, followed by Government bonds with $1.6 billion, while inflation linked ETFs/ETPs experienced the largest net outflows with $839 million.
Commodity ETFs and ETPs saw net outflows of $6.7 billion. Precious metals ETFs/ETPs experienced the majority of these outflows with $6.3 billion net outflows, of which $6.0 billion left products tracking gold.
In May Vanguard, Daiwa and SPDR ETFs received the largest net new assets with $4.5 billion, $4.4 billion and $4.4 billion in net inflows respectively, followed by Wisdom Tree with $3.1 billion net inflows.
“Net inflows into ETFs providing exposure to Japan during May elevated Daiwa and Wisdom Tree into the top 4 firms out of 211 ranked by net inflows” according to Deborah Fuhr, Managing Partner at ETFGI.
iShares remains the largest ETF and ETP provider with assets of $820 billion, reflecting 38.4% market share but ranked 5th in terms of net inflows in May with $2.4 billion; SPDRs is the second largest provider with $365 billion and 17.1% market share, followed by Vanguard with $290 billion and 13.6% market share. PowerShares is fourth placed with $74 billion and 3.5% market share, followed by db x-trackers/db ETCs with $69 billion. The top five ETF and ETP providers, out of 211, account for 76% of global ETF and ETP assets.
Wikimedia CommonsJavier Arrigunaga, presidente de la Asociación de Bancos de México. La Asociación de Bancos de México recibe el "Premio Anual de Liderazgo en Educación"
La organización Worldfund entregó el “Premio Anual de Liderazgo en Educación” a la Asociación de Bancos de México y las instituciones bancarias que la integran, por su labor ininterrumpida de más de seis años en apoyo a la educación de México, a través del programa Bécalos.
El premio fue recibido por Javier Arrigunaga, presidente de la Asociación de Bancos de México, de manos del embajador de México en EE.UU., Eduardo Medina Mora.
Durante su intervención, el presidente de la ABM expresó: “Es para mí un honor recibir este premio a nombre de la Asociación de Bancos de México y las instituciones que la integran. En la banca en México tenemos un compromiso firme por apoyar la educación, ya que estamos convencidos de que es uno de los ejes fundamentales para el progreso de cualquier nación. También quiero reconocer y agradecer a los millones de clientes de los bancos en México, sus generosos donativos son la base del programa Bécalos, así como las aportaciones de las instituciones bancarias con capital semilla o su red de cajeros automáticos”.
El propósito del “Premio Anual de Liderazgo en Educación” es reconocer a las corporaciones o líderes que han demostrado un compromiso en favor de la educación en América Latina. Worldfund es una organización con sede en Estados Unidos, cuya finalidad es financiar e impulsar iniciativas que fomenten la educación en América Latina para transformar vidas y reducir la pobreza en la región.
Desde el año 2006, la Asociación de Bancos de México y las instituciones bancarias que la integran, han hecho posible el programa Bécalos, en conjunto con la Fundación Televisa. Bécalos es el principal programa de apoyo a la educación impulsado por la sociedad civil. Las becas se otorgan en áreas prioritarias para el desarrollo del país: ingenierías, ciencias, y carreras técnicas con lo que se brinda apoyo a propuestas innovadoras en materia educativa.
Entre sus resultados más notables del programa Bécalos cabe destacar:
163.874 becarios han sido beneficiados entre 2006 y 2012
34.000 jóvenes beneficiarios han concluido sus estudios de bachillerato y educación superior.
4.000 maestros y directivos de toda la República han participado en los congresos educativos de Bécalos.
700 maestros y directivos premiados con diplomados en la Universidad Autónoma de Madrid.
Por su parte, entre los logros del Worldfund destaca:
Ha invertido más de 12 millones de pesos en programas educativos en la región desde su lanzamiento en 2002.
Lo anterior ha beneficiado a más de 400.000 estudiantes anualmente.
La meta es apoyar a alrededor de un millón de estudiantes anualmente para el 2015.
El Premio Anual de Liderazgo en Educación ha sido otorgado en otros años a personalidades como Carlos Slim, Presidente de Teléfonos de México, Emilio Azcárraga Jean, Presidente de Grupo Televisa, José Antonio Fernández Carbajal, Presidente de FEMSA y Claudio X. González Laporte, Presidente de Kimberly-Clark de México, entre otros.
Pershing LLC, a BNY Mellon company, released a new report offering a look at the makeup of today’s affluent advisor/client relationship. The report, entitled “Investor of the Future: The Quest for Tomorrow’s Affluent Clients Must Start Today,“ offers best practices that firms and advisors can adopt in support of changing client demographics. In the report, Pershing gauges advisors’ perceptions of the broader market, and offers insight into which clients may be most influential in shaping advisors’ businesses in the future.
Unveiled today at INSITE™ 2013, Pershing’s annual financial solutions conference, the report shows that today’s family is fundamentally different than in years past. Today’s modern family no longer primarily consists of married, heterosexual couples with two or more children. Today, half (51%) of Americans are single (some are single parents), many women are the sole or primary breadwinners in their families, same-sex marriage is now legal in ten states and it is estimated that racial minorities will become the majority in the U.S. by 2042 (Source: U.S. Census). So it’s important that advisors recognize the unique financial needs of each of these groups to be able to deliver effective solutions.
“As we see continued shifts in wealth and advisory services, advisors that align their businesses with quickly evolving client dynamics will ensure continued mutual success and growth,” says Kim Dellarocca, head of practice management and segment marketing at Pershing.
The report revealed that advisors’ perceptions of their client-base versus the actual affluent market profiles of these groups are often misaligned. As client segments such as minority groups, younger investors and women comprise a growing percentage of the affluent market, their economic influence will grow. Advisors who neglect to strategically engage these segments as part of today’s client mix may risk a plateau or decline in their business in the future.
The report further concludes that advisors are missing out on an enormous opportunity to keep their clients’ children as investors. Even though more than half of clients considered to be affluent have children 18 years and older, advisors have only talked with about 35% of this investor group about their finances or future investments. Furthermore, only half of advisors (52%) offer expertise in intergenerational wealth transfer and less than half (46%) offer expertise in trust services.
Another important point made in the research is that over-diversification is not necessarily effective. The report warns that advisors put themselves at risk of not being able to meet client expectations if they spread their business across too many different client segments. Rather, it suggests that advisors should identify and focus on a few key groups. This kind of specialization will help advisors deliver greater value and distinguish themselves from competitors.
Wikimedia Commons. Grupo Modelo Closes the Sale with Anheuser-Busch InBev a Year After Their Announcement
Anheuser-Busch InBev and Grupo Modelo, S.A.B. de C.V. announced that AB InBev has successfully completed its combination with Grupo Modelo in a transaction valued at $20.1 billion.
The combination is a natural next step given the successful long-term partnership between AB InBev and Grupo Modelo, which started more than 20 years ago. The combined company will benefit from the significant growth potential that Modelo brands such as Corona have globally outside of the U.S., as well as locally in Mexico, where there will also be opportunities to introduce AB InBev brands through Modelo’s distribution network.
The combined company will lead the global beer industry with roughly 400 million hectoliters of beer volume annually, bringing together five of the top six most valuable beer brands in the world. Mexico is the world’s fourth largest profit pool for beer and a very attractive market due to its projected growth. The combination is also expected to generate approximately $1 billion in cost synergies.
Carlos Brito , CEO of Anheuser-Busch InBev, said, “We have tremendous respect for Grupo Modelo and its brands, and we are thrilled to welcome our Grupo Modelo colleagues to the global team. We look forward to realizing our opportunities for growth and bringing our beers to more consumers around the world as we join two world-class brewers.”
As previously announced, Ricardo Tadeu will serve as Zone President Mexico and Chief Executive Officer of Grupo Modelo, effective immediately. Mexico will become AB InBev’s seventh Zone. Grupo Modelo’s headquarters will remain in Mexico City, and it will continue to have a local board, which will be appointed by AB InBev at the next shareholders meeting of the company. Carlos Fernandez , Maria Asuncion Aramburuzabala and Valentin Diez Morodo have been invited to continue to play an important role on Grupo Modelo’s Board of Directors.
Maria Asuncion Aramburuzabala and Valentin Diez Morodo will also join AB InBev’s Board of Directors, subject to the approval of AB InBev’s shareholders at the next shareholders meeting.
Tender Offer Settlement
In connection with the completion of the combination, AB InBev announced the successful settlement of the all-cash tender offer for the remaining shares of Grupo Modelo that it did not already own for $9.15 per share. As of May 31, 2013, approximately 89% of Grupo Modelo’s outstanding Series C common shares were validly tendered and acquired in the tender offer by a subsidiary of AB InBev. AB InBev now owns approximately 95% of Grupo Modelo’s outstanding common shares.
Grupo Modelo will be fully consolidated in the AB InBev financial reporting as of June 4, 2013. Later today, AB InBev will establish and fund a trust that will accept further tender of shares by Grupo Modelo shareholders at a price of USD 9.15 per share over a period of up to 25 months, during which time Grupo Modelo shares will continue to be quoted on the Mexican Stock Exchange. AB InBev will recognize in its financial reports the amount deposited with the trust as restricted cash and will recognize a liability for the Grupo Modelo shares it did not acquire by the end of the MTO.
U.S. Divestiture
The related transaction with Constellation Brands, including the sale of Grupo Modelo’s Piedras Negras brewery, Grupo Modelo’s 50% stake in Crown Imports and perpetual rights to Grupo Modelo’s brands in the U.S., is expected to close on June 7, 2013.
Tim Stevenson, manager of the Henderson Horizon Pan European Equity Fund. Europe is dead. Long live Europe!
After such a strong rise in markets since last year’s “Whatever it takes” speech from Mario Draghi, President of the European Central Bank, many investors are asking whether European markets can make further gains. Given that wide parts of the press persist with the same old, same old ‘Europe is dead’ lament, such questions are entirely justified. There are a number of reasons why I, in fact, remain confident that patient investors will see a positive return from increasing their exposure to European equities.
Firstly, after two years of earnings declines, both “top down” and “bottom up” estimates for 2013 and 2014 are gravitating towards 6% followed by 14% growth. Both these estimates look realistic to me, even in the context of a global push to capture tax from previously hidden earnings. Hence although European markets have rerated from very low levels a year ago, earnings growth should help sustain markets from here. Viewed from a Shiller cyclically adjusted price to earnings perspective (the Shiller CAPE method), European markets are, even today, at historically low levels. From an income perspective, European equities currently have a higher yield than even Investment Grade bonds.
Secondly, there is a “weight of money” argument. While I fully accept that these can be the weakest rationale ever for buying a market, there is significant evidence that international investors are rebuilding their European allocation, precisely at the time when domestic institutional investors are also switching away from bonds, which are at present at historically high levels in portfolios as well as in terms of valuations. Recent bond market weakness may be a further incentive for investors to accelerate this move. Furthermore, if inflation is the route that Central Banks and Finance Ministries attempt to choose in preference to deflation and long term stagnation as a way to grind down the global debt burden, then equities are a far better investment. There is a lot of evidence that a sustained period of negative interest rates is a means of grinding those debt levels down over a number of years. That also explains recent reports that Central Banks have been buying equities.
Thirdly, there has started to be a concerted attempt to move the debate in Europe on from “austerity” to “growth”. That may be easier said than done, but I suspect that the recent change in rhetoric from all European leaders is highly significant. This is not Europe backing away from the underlying principle of trying to run its economy properly, but recognition of the fact that European electorates will no longer tolerate rising unemployment, especially amongst the younger population. It is more of a case of changing the “flight path” to fiscal sustainability. The fact that Germany faces elections in a few months also fuels the rationale for more economic stimulus from Europe’s strongest economy. Global economies are starting to see growth return and it looks like Europe could be in a position to join that trend as early as next year.
Related to all these points is a more widespread recognition of the leadership position of many European companies. Global investors are realising they cannot longer afford to ignore some of the world’s leading companies listed in Europe.
Recent equity market volatility is once again a typical, utterly irrational reaction to what is, in fact, good news. Clearly the world will need to wean itself off the artificial stimulus of quantitative easing – QE –, in the same way as patient in hospital will only slowly recuperate from a major illness. The fact that the QE drugs are slowly being withdrawn is the logical consequence of a more sustainable growth in years to come.
That growth will remain low, and working off the global debt burden will be a lengthy process, preventing rapid economic growth. But that does certainly not mean it is time to run away from European equities – in fact, we do believe that it is quite the opposite: continue to add on during the inevitable corrections that are bound to occur. The press may say Europe is dead, but as an investor I can declare: Long live Europe.
Opinion article by Tim Stevenson, manager of the Henderson Horizon Pan European Equity Fund
H.I.G. Capital, LLC, a leading global private equity firm, is pleased to announce that its affiliate has made a strategic investment in Raymond Express International. Founded in 1983, REI is an asset-light logistics provider specializing in transportation solutions for temperature-sensitive products. From its facilities in San Francisco, Los Angeles, and Seattle, the Company primarily services military and commercial customers seeking to transport perishables from the West Coast of the United States to Asia.
“H.I.G. recognizes the critical role we play for our customers and is committed to expanding our capabilities to even better serve our markets.”
H.I.G. has partnered with REI’s founder, CEO Raymond Wong, and his co-shareholder and EVP David Moore to continue the Company’s thirty-year track record of providing the most reliable and efficient logistics services to its customer base. Enlightenment Capital, an aerospace, defense & government focused investment firm, invested alongside H.I.G.Capital.
“We are excited to have H.I.G. Capital lead this investment in REI,” said Raymond Wong. “H.I.G. recognizes the critical role we play for our customers and is committed to expanding our capabilities to even better serve our markets.” Dave Moore added, “We see a number of factors driving greater demand for our services in the years ahead and this investment will help us grow to meet that demand with our same exceptional customer service levels.”
H.I.G. is a global private equity investment firm with more than $12 billion of equity capital under management. Based in Miami, and with offices in Atlanta, Boston, Chicago, Dallas, New York, and San Francisco in the U.S., as well as international affiliate offices in London, Hamburg, Madrid, Paris, and Rio de Janeiro, H.I.G. specializes in providing capital to small and medium-sized companies with attractive growth potential.
Raymond Express is an asset-light logistics solutions provider headquartered in South San Francisco, California. REI provides logistics and transportation solutions for perishable, temperature sensitive products, including fresh fruits and vegetables, meat, seafood, and medicine. The Company specializes in the movement of goods from the U.S. West Coast to Asia.
Northern Trust has appointed Fiona Moore as head of fund administration for its exchange traded funds (ETF) business across Europe, Middle East and Africa.
Based in Dublin, Moore is responsible for managing all ETF administration activities for Northern Trust’s clients across the region. She replaces Liam Butler who has assumed the role of head of Northern Trust’s hedge fund servicing group.
Moore joined Northern Trust as part of its acquisition of Bank of Ireland Securities Services and was most recently a senior relationship manager in the company’s Global Fund Services business. During her 17 years of experience in financial services, Moore has had responsibility for managing a diverse range of client relationships and structures, including physical and synthetic ETF structures.
“Fiona’s experience and expertise across the broad spectrum of markets, structures and services pertaining to ETF administration in Europe will be valuable as we continue to evolve our solutions and services supporting this specialist area, here in Ireland,” said Clive Bellows, country head Ireland, Northern Trust
Northern Trust’s Global Funds Services group has been providing fund administration solutions for European ETFs for more than 10 years. It supports physical, synthetic and hybrid ETF models, including both cash and in-specie dealing methodologies for a broad range of global assets, including equities, fixed income, real estate, infrastructure, listed private equity, regional and sector specific ETFs.
