Boutique Asset Managers launch GBAM to help compete with global players

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Ocho gestoras boutique suman fuerzas para competir con los grandes jugadores
Foto: Keuchhustus . Boutique Asset Managers launch GBAM to help compete with global players

Boutique asset managers met in Spain on Thursday and Friday to form a self-help group to enable them to compete more effectively internationally with more dominant global players and to foster cooperation among themselves to increase their competitiveness. The boutiques have agreed to form an association which they have called: “Group of Boutique Asset Managers” or ‘GBAM’, said the new association in a press release.

The inaugural meeting of GBAM was led by March Gestión de Fondos– the asset management arm of the Spanish private bank, Banca March, and supported by other attendees from LatAm, Europe and Asia. Having set-up the organisation GBAM is now seeking other ‘like-minded’ boutiques.

The formation of GBAM is in response to theincreasing polarization of the asset management world between big asset managers with a broad range of capabilities and small specialist boutiques with a limited range of investment strategies (the “Barbell” effect)1. One aspect of the Barbell effect (often highlighted by commentators) is the ability of those managers caught in the ‘middle ground’ to survive. Less well appreciated, is the position of world class boutique asset managers whose voices (and successful investment strategies) are less well heard in world markets, given the dominance of powerful, well resourced, global players.

In response to this dominance, GBAM has been formed to foster cooperation among like-minded boutique/specialist asset managers. The managers who met in Spain are ‘like-minded’ in that they all share a performance driven culture, are generally recognised for their talent, creativity and entrepreneurial spirit. Crucially, all have interest in expanding their businesses internationally, and so all face similar challenges in terms of managing to do so on limited resources. By coming together to share information2, the Group believes its members will be in a better position than they otherwise might have been.

The chief executive of asset manager March Gestión de Fondos, José Luis Jimenez said:

“Asset management is an exciting business given the levels of competition amongst the firms – large and small. And all of us seek to offer the very best strategies to investors. But while the boutiques represented in GBAM are happy to compete with the very best, we have to appreciate that the investors around the world may not be in a position to access boutiques managers as easily as the big firms. On the one hand, small players cannot be available everywhere and on the other, as a consequence of the crisis, many distributors’ prefer well-known names because it is easier to pick up a strong brand recognised by investors”.

“GBAM is not interested in involving itself in lobbying or competing with our national or international trade organizations. Rather, it is just a group of like-minded people who want to discuss important things in an open way and exchange ideas – our only goal being to improve our businesses on behalf of our clients and partners.

“Excellent world class boutique mangers can grow, even in a sector dominated by big players, providing they can offer greater added value that them. Performance plays a critical part, but equally being the first to discover new and interesting investment propositions or the strong alignment of interest that boutique managers have with their clients, is an attractive proposition,” said Jimenez.

The founding members of GBAM include:

  • Bestinver    (Spain)
  • Banif         (Portugal)
  • Lampe         (Germany)
  • Banca Sella   (Italy)
  • Mutuactivos   (Spain)
  • Corpbanca     (Chile)
  • Banca March   (Spain)
  • GBM           (Mexico)

ING Appoints Rudolf Molkenboer nombrado presidente y CEO de ING Financial Holdings

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ING Appoints Rudolf Molkenboer nombrado presidente y CEO de ING Financial Holdings
Foto: Ziko-C . Rudolf Molkenboer es nombrado presidente y CEO de ING Financial Holdings

Rudolf Molkenboer has been appointed President & CEO of ING Financial Holdings Corporation, effective March 18, 2013. ING Financial Holdings Corporation is a subsidiary of ING Group, a global financial institution of Dutch origin, offering a full range of financial services. In his new role, Molkenboer will oversee the firm’s business activities in the United States, which include structured finance, commercial lending, and financial markets sales and trading, and also has regional responsibility for the firm’s businesses in Latin America.  He is based in New York and reports to Diederik van Wassenaer , ING’s Global Head of Clients & Network.

Molkenboer, 50, previously served as Global Head of Real Estate Finance (REF), ING Commercial Banking, based in The Hague, The Netherlands, and was primarily responsible for the successful integration of the global REF business into ING’s Commercial Banking platform. He joined ING in 2007 as Global Head of the Event Finance team, which assist in structuring transactions for ING clients globally. Previously, Molkenboer led the Media Benelux sector team at ABN Amro from 2001 to 2007. He began his career at Price Waterhouse as a tax advisor in the international tax practice.

“Rudolf has a proven track record of creating and expanding client-focused businesses for our operations,” said Diederik van Wassenaer . “His managerial, lending and business skills, combined with his extensive experience leveraging ING’s global network and services to clients, make him ideally suited to build on our solid business platform in the Americas.”

Thaddeus Shelly Joins Tiedemann Wealth Management in Palm Beach

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Thaddeus Shelly Joins Tiedemann Wealth Management in Palm Beach
Foto: Detroit Publishing Co. Thaddeus Shelly se une a Tiedemann Wealth Management en Palm Beach

Tiedemann Wealth Management announced the appointment of Thaddeus R. Shelly, III as a Managing Director and Senior Advisor. In this role, Mr. Shelly will be based in Tiedemann Wealth Management’s Palm Beach office and responsible for developing and maintaining client relationships.

“Thad is a very talented, well-respected leader who will provide our clients with trusted, objective wealth management solutions”

Mr. Shelly joins Tiedemann from Lazard, where he served as a Managing Director and Chief Executive Officer of Lazard Wealth Management, overseeing the Firm’s private wealth management effort in the U.S. Prior to joining Lazard in 2009, he was a Senior Managing Director at Bessemer Trust where he oversaw all client acquisition and account management for their Mid-Atlantic, South and Southeast regions and their Delaware Trust Company.

Before joining Bessemer, Mr. Shelly was the Founder and Director of Private Client Services at Legg Mason from 1992 to 1998. He began his career in Goldman Sachs’ Private Wealth Management business in 1984.

“Thad is a very talented, well-respected leader who will provide our clients with trusted, objective wealth management solutions,” said James Bertles, a Principal of the Firm. “His 29 years of private wealth management experience and expertise offer a unique perspective that will further enhance our industry-leading client services and national presence.”

Ryan Forms Strategic Alliance with Godoy & Hoyos Abogados

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Ryan, a global tax services firm with the largest indirect tax practice in North America, announced a strategic alliance with Godoy & Hoyos Abogados, a Latin American tax law firm based in Colombia, with significant experience in tax planning, tax consulting, tax litigation, and foreign trade issues. This strategic alliance will support the continued growth of Ryan’s International Tax practice throughout Latin America. Godoy & Hoyos Abogados is a three-time recipient of the Colombian Tax Litigation Firm of the Year award and also received the 2012 Colombian Tax Firm of the Year award, both sponsored by the International Tax Review. They will support Ryan’s ability to deliver higher levels of value and results for the Firm’s expanding portfolio of multinational clients and provide business development opportunities to extend the Firm’s North American leadership position in tax services to Colombia.

“We are proud to deploy the leading experts from Godoy & Hoyos Abogados across Colombia, as partners in support of our international tax engagements,” said Todd E. Behrend, Ryan’s International Tax Practice Leader. “Their leadership in tax services will help drive substantial added value for our multinational clients.”

“Ryan already provides tax services to many of the world’s leading global companies, and the partnership with Godoy & Hoyos Abogados will deliver tremendous value through additional Colombian international tax solutions,” said Brendan F. Moore , Ryan Executive Vice President and Vice Chairman of Global Corporate Development. “The trust that Ryan has earned by delivering superior results for these multinational clients drives our commitment to dramatically expand Ryan’s international tax services.”

“We are proud to reinforce our international tax services with the expertise and best-in-class solutions of Godoy & Hoyos Abogados,” said G. Brint Ryan, Chairman and CEO of Ryan. “The firm is an exceptional strategic partner that will strengthen our international capabilities and support our expansion into Colombia.”

Godoy & Hoyos Abogados is a law firm with a team of highly qualified practitioners who are national leaders in their respective fields with years of work experience supporting national and international companies. Established in 2004, the main practice areas of the firm are tax, corporate, commercial, competition, civil, insurance, and oil and gas law. With a versatile and innovative approach based on knowledge and research, the firm supports clients in their processes and critical decisions by identifying effective, prudent, and timely legal solutions. The firm assists clients with corporate issues (mergers and acquisitions, reorganizations, and other corporate matters), competition, corporate governance, foreign investment, international trade, oil and gas, insurance, commercial, and civil law.

Ryan is an award-winning global tax services firm, with the largest indirect tax practice in North America and the seventh largest corporate tax practice in the United States. Headquartered in Dallas, Texas, the Firm provides a comprehensive range of state, local, federal, and international tax advisory and consulting services on a multi-jurisdictional basis, including audit defense, tax recovery, credits and incentives, tax process improvement and automation, tax appeals, tax compliance, and strategic planning. Ryan is a three-time recipient of the International Service Excellence Award from the Customer Service Institute of America (CSIA) for its commitment to world-class client service. Empowered by the dynamic myRyan work environment, which is widely recognized as the most innovative in the tax services industry, Ryan’s multi-disciplinary team of more than 1,600 professionals and associates serves over 9,000 clients in 40 countries, including many of the world’s most prominent Global 5000 companies.

Key Biscayne: Tennis, Bankers and “Drama”

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Key Biscayne: tenis, banqueros y “drama”
Wikimedia CommonsCast for the Regional Premiere of Shrek The Musical, the first production sponsored by the KBMDC. Key Biscayne: Tennis, Bankers and “Drama”

The performing arts scene of Miami has regained one of its most established players: The Key Biscayne Music and Drama Club – KBMDC –, a non-profit organization founded in 1956 that has presented plenty of shows up until 1995 when its headquarters, the Calusa Playhouse Theatre, was destroyed by fire.

“KBMDC was a landmark for the performing arts in Miami. The club used to present musicals with actors and productions brought directly from Broadway, as well as concerts and plays of the highest level. They were an artistic reference of high quality in this city, and that is why we want to bring back to life this project in Key Biscayne; we want to present Miami with a second alternative in the community theatre arena”, explains Angelica Torres, vice president of the board of directors of KBMDC, in clear reference to the Actors Playhouse. “We have the support of the Key Biscayne Community Foundation and the Village of Key Biscayne”, she added. The new board of directors of KBMDC is comprised of Key Biscayne residents, among which Pat Weiman, former memeber of the village’s council, can be found.

Key Biscayne, where the Sony Ericsson Open tennis tournament was just held, is a small island located just 7 miles from Brickell Avenue.This is the financial center of Miami, where the headquarters of major international private banks from around the world are located one after another. These banks are the destination for much of the $250 billion coming from Latin America and that takes refuge in the United States. The proximity to Brickell, as well as the idyllic characteristics of the key, are the some of the reasons why so many investment professionals along with many of their clients, decide to establish their residence in this village, which is also one of the richest in the US due to the high collection of property taxes. Despite so much wealth, the sponsorship of the visual and performing arts has been pushed into the background for the last two decades. This situation has shifted significantly since the re-launch of KBMDC.

The Club’s first event will be a cocktail party presenting the project, which will take place in April 14th. This party will introduce the first production presented by de KBMDC: the Regional Premiere of Shrek. This musical, which will premiere in Miami during the last quarter of this year, is in an advanced pre-production process and features a cast of remarkable professional and semi-professional singers and dancers (watch video). The producer is Broadway Musical Theatre – BMT – a theater group led by Angelica Torres, who since 2006 has staged 20 productions with children and young performers from South Florida.

“With the release of Shrek, we want to plant the first seed of a professional project and a visual and performing arts program in South Florida, channeled through the sponsorship of the Key Biscayne Music and Drama Club”, added Angelica. “Shrek is a very complex show of the highest level in which the set, the costumes, the music and of course, the actors, have to be very good”, emphasizes the director and choreographer of the musical.

The cocktail party presentation will take place on April 14 in Key Biscayne, for a select group of art lovers, patrons and supporters of the new Club. During this event there will be a preview performance of Shrek The Musical, by some of the members of the same cast which will premiere the musical in December 2013.

The event, which is co-sponsored by the Village of Key Biscayne and by the Key Biscayne Community Foundation, wants to lay the foundations for KBMDC to become the new center for the promotion of culture and performing arts, from a municipality that has one of the highest per-capita incomes in the U.S.

If you are interested in obtaining more information regarding the re-launch of the Key Biscayne Music and Drama Club, as well as to confirm your assistance to the presentation cocktail, you can contact the organization through this email: kbmdclub@gmail.com

MoraBanc Group Focuses on Latin America, Where it Expects to Double its Business by Year-End

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MoraBanc group se centra en América Latina, en donde espera duplicar su negocio antes de final de año
Gilles Serra, CEO of MoraBanc Group.. MoraBanc Group Focuses on Latin America, Where it Expects to Double its Business by Year-End

Mora Banc is convinced that its business needs to continue growing through Latin America after they have experienced regulatory changes that have forced the Andorran bank, which has always been sustained by the business of the residents in Andorra, Spaniards and to a lesser extent the French, to grow its business outside of the Spanish borders.

Gilles Serra, CEO of MoraBanc Group, showed this confidence in an interview with Funds Society. He reviewed the situation of  the group in Andorra, analyzed the private bank’s situation and reviewed the growth forecast paying special attention to Latin America.

Develop the business outside of Spain

The head of the organization, which recognizes that Andorra is a small arena, pointed out that the bank has been committed to developing its business outside of the Spanish borders, “facing towards Latin America”. Regarding this, he explained that Latin America should not be viewed as a region, but instead it should be analyzed country by country, as any other analysis can lead to an ill-fated approach. “There are countries that are not doing very well, although each country presents different opportunities”.

They are planning on conducting new recruitments for Latin America, for the Mexican and Brazilian markets. They are also expecting to double their business by the end of the year, in a market in which “we are growing very rapidly”, he added. Although, he explained that any new movement made in the region will be very well measured.

The executive explained that the international strategy is being carefully assessed, and that they are not jumping fast into new openings and purchases.

Broker dealer in Miami

MoraBanc has decided to buy a small asset management company in Zurich and to make a larger investment in Miami, in order to be able to offer their services to Latin American clients. Last November, the company was setting its broker dealer in Miami. “We thought that it was the right time to offer a different kind of service;that is why we opted for a broker dealer and not for a traditional bank. The business has taken off very well”.

He recalled that in 2012 they opened a representative office in Uruguay, where the business keeps on growing in accordance with the macroeconomic situation in the Southern Cone.

Regarding the possibility of buying other companies, Serra seemed very determined. “The cost of a bank has nothing to do with the price. It is very complex to appraise a bank when you want to purchase it”. He believes that the purchase can turn out very badly, due to the fact that you can never completely appraise what you will find following the operation.

As for the possibility of opening new markets in Latin America, Serra pointed out that even though other local traders have opted for other countries of the region, MoraBanc still doesn’t have the need to follow those footsteps. For the moment they are confortable just the way they are, and in several years they may look into new openings.

“The model portfolio was trendy 20 years ago”

As far as his investment policy, he told us that better products are being released every day for small clients, however when it comes to big clients everything is tailored in accordance with their individual needs. “We are not very keen in model portfolios; we talk more in terms of personal risk profile. The model portfolio was trendy 20 years ago, when the transactions were very expensive”, whereas today the technology changes allow more suitable investments.

Security and legal structure versus product

Serra, who pointed out that they will adapt their offer to the needs of their clients, believes that currently clients do not demand products, since “people are more worried about security and legal structure”. Thus, he believes that if before the clients were searching for the perfect product, right now what prevails are the two aforementioned concepts due to the current conditions in the sector. “The shock that the clients in Cyprus have experienced has given even more importance to the concept of legal security”.

As far as Asia is concerned, Serra pointed out “when we decide to go, it will be with the purpose of making money. On that continent there is a small amount of banks that earn money, while there are none earning money with private banking. You will need a lot of leverage in order to be able to operate in Asia. It is an area of product and leverage”, and of a lot of risk, he emphasized.

Mora has opened an office in Dubai which targets the expatriates who work in that region, rather than local clients. They work from their Swiss office with Asian clients in asset management, and they are trying to successfully capture this share of the market.

All Latin American Financial Centers Climb Positions According to Industry Survey

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All Latin American Financial Centers Climb Positions According to Industry Survey
Encuesta GFCI 13 - marzo 2013. Todos los centros financieros de América Latina suben posiciones en el ranking GFCI

The Global Financial Centers Index (GFCI) provides profiles, ratings and rankings for 79 financial centers, drawing on two separate sources of data – instrumental factors (external indices) and responses to an online survey.

The main headlines of GFCI 13 are:

  • London, New York, Hong Kong and Singapore remain the top four centers. London’s ratings seem to have been unaffected by the LIBOR scandal. Hong Kong and Singapore are now only two points apart.
  • The financial centers in Europe are still in turmoil as the Eurozone crisis continues. Zurich and Geneva confirm their position in the GFCI top ten. Frankfurt and Paris rise significantly and have closed the gap on London a little. Luxembourg, Vienna, Milan and Rome also show improvements and also move slightly closer to London. Lisbon, Reykjavik, Budapest and Athens however decline, and remain at the bottom of the GFCI rankings.
  • All Asia/Pacific financial centers except Beijing see their ratings improve in GFCI 13. This confirms the thinking that the decline in ratings in GFCI 12 was a temporary pause rather than the end of their long term improvements. Kuala Lumpur, Singapore and Tokyo experience the strongest rises in the region. Beijing however is the largest faller in GFCI 13, down by 15 places.
  • All centers in the Americas see their ratings improve although Chicago, Toronto and San Francisco fall slightly in the ranks. Boston enters the GFCI top ten, climbing to 8th place. Boston was previously in 11th place and has now moved just above Seoul, Chicago and Toronto. All Latin American centers make significant progress in terms of both rankings and ratings. Sao Paulo and Rio de Janeiro are now in the GFCI top 50 both having climbed four places. Buenos Aires makes a significant gain of 55 points and is now in 53rd place. Santiago has been added to the GFCI questionnaire recently but still needs to acquire sufficient assessments to be included in the index
  • Offshore centers continue to gain ground in GFCI 13 with good improvements in their ratings. Jersey and Guernsey remain the leading centers. These two are followed by Monaco  which ranks 35th in GFCI 13, up by 25 ranks and 57 points since GFCI 12.

You may access the complete GFCI 13 assessment through this link.

Greece is Trading at Recovery Value

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According to a report released by Morgan Stanley this week, the brokerage firm is more constructive on Greece than consensus expectations. “A recovery hasn’t started yet, but soft data are becoming less bad, as the shocks that hit the Greek economy – including euro exit worries – are starting to dissipate, and bank deposit flows now look fully stabilized”.

Morgan Stanley points out that the competitiveness gap is closing. “With unit labor costs likely to fall further, the incentive for Greece to exit the Eurozone to boost competitiveness via a weaker exchange rate is no longer there,” points out the research. Morgan Stanley expects Greece to reach a primary budget surplus this year and maintain it thereafter.

“We expect the GGB strip to reach 52.5% by year-end. We also see valuations higher in most scenarios of second restructuring”

They also emphasize that contagion risks from Cyprus appear limited. “The main sources of uncertainty are domestic politics and the ongoing Troika review of the Greek program. While there’s some room for maneuver, the government’s ability to stay the course will continue to be widely watched by investors over time”.

Morgan Stanley finds the risk/reward particularly attractive in GGBs. “Current valuations are lower than in most of the medium-term scenarios we laid out. In fact, we expect the GGB strip to reach 52.5% by year-end. We also see valuations higher in most scenarios of second restructuring”.

Morgan Stanley’s economists, Daniele Antonucci and Samar Kazranian, see downside only in the case of a euro exit (a remote tail risk, in their view) or a potential second restructuring with the private and the official sectors taking a 60% principal reduction  which they consider would be a quite a harsh scenario for the private sector.

Muzinich: Heinz’s LBO pricing does not reflect a return to excessive leverage

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Muzinich: Heinz’s LBO pricing does not reflect a return to excessive leverage
Ketchup Heinz. Muzinich: el bajo precio del LBO de Heinz no refleja una vuelta al apalancamiento excesivo

Headlines have been awash in talk of the Heinz LBO. The bonds priced at month end at 4.25% ‐ the lowest yield ever for an LBO issue. In its latest Corporate Credit Market Snapshot Muzunich considers the Heinz deal to be a one‐off and in no way reflective of an uptick in LBOs or a return to excessive leverage. “Heinz was relatively unique since it is a highly recognizable brand name and benefitted from Warren Buffett’s participation. Buffett’s sizeable equity contribution helped drive down financing costs for the bond and loan portions of the deal,” highlights the snapshot, available in the asset manager’s website.  

According to Muzinich, the deal also highlights the strength of the loan market ($10 billion of Heinz loans cleared the market) and the generally favorable borrowing rates currently available. Muzinich does not believe the deal reflects deteriorating corporate fundamentals. “On the contrary – corporate fundamentals remain strong as evidenced by the increase in rising stars (high yield companies that are upgraded to investment grade status),” points out the asset manager in the report. Last month in the U.S. high yield market, four companies with $12 billion of bonds outstanding, were upgraded to investment grade. “This is the highest number of monthly upgrades from high yield to investment grade in more than 7 years and underscores the strong corporate fundamentals that underpin the current high yield market”, they conclude.