BNY Mellon, the global leader in investment management and investment services, has named Judy L. Hu as chief marketing officer, effective Feb. 1, 2013. Widely recognized for her global expertise in brand-building and business-to-business marketing, she will report to R. Jeep Bryant, executive vice president for marketing and corporate affairs. Hu joins BNY Mellon from General Electric Company, where she has served as global executive director of advertising and branding since 2002.
While at GE, Hu was a key architect behind the repositioning of the company’s historic brand through campaigns including “Imagination at Work” and “ecomagination.” Hu drove innovation across all media in key markets around the world, winning dozens of awards for effectiveness and impact. In addition, Hu developed strategies to engage clients and communities through signature sponsorships globally.
“In recent years, BNY Mellon has significantly advanced its leadership position in investment management and investment servicing, creating a company with a powerful focus on helping investors succeed,” Bryant said. “Judy has a proven track record of building brands that reflect the strength of the business. With her expertise and leadership, we will continue to build our brand by demonstrating our commitment to delivering excellence and to being invested in the success of all of our stakeholders.”
Hu’s 30-year career spans the publishing, agency and corporate sectors. Her experience at advertising agency Leo Burnett took her to Hong Kong for several years, where she was responsible for a broad range of clients including United Airlines. During Hu’s six years in leadership positions at General Motors, she created a diversity marketing team to engage minority stakeholders in the GM brand and led advertising and sponsorship initiatives.
A native of Detroit, Hu has a master’s degree in business administration from Yale University and a bachelor’s degree in English and American Literature from Harvard University.
BNY Mellon is a global financial services company focused on helping clients manage and service their financial assets, operating in 36 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, offering superior investment management and investment services through a worldwide client-focused team. It has $27.9 trillion in assets under custody and administration and $1.4 trillion in assets under management, services $11.6 trillion in outstanding debt and processes global payments averaging $1.4 trillion per day. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK).
The European Fund and Asset Management Association (EFAMA) has released the latest international statistical release containing worldwide investment fund industry results for the third quarter of 2012. The main highlights for Q3 2012 include:
Investment fund assets worldwide increased by 2.5 percent to EUR 21.95 trillion in the third quarter of 2012. In U.S. dollar terms, worldwide investment fund assets increased 5.3 percent during the quarter to US$ 28.38 trillion. This difference reflects the depreciation of the US dollar vis-à-vis the euro during the quarter.
Total worldwide net inflows into investment funds amounted to EUR 167 billion during the third quarter, up from EUR 99 billion in the previous quarter. This increase was achieved thanks to stronger net inflows into balanced and bond funds.
Long-term funds (all funds excluding money market funds) registered increased net inflows during the quarter of EUR 175 billion, up from EUR 141 billion in the second quarter.
Bond funds continued to enjoy strong net inflows (EUR 146 billion), up from EUR 121 billion in the second quarter.
Equity funds recorded the fifth consecutive quarter of net outflows (EUR 43 billion, up from EUR 14 billion in the previous quarter).
Balanced/mixed funds registered a large increase in net sales to EUR 38 billion, compared to EUR 2 billion in the previous quarter.
Money market funds registered net outflows of EUR 9 billion, down compared to the second quarter (EUR 42 billion). The United States registered net inflows of EUR 29 billion during the quarter, marking a turnaround compared to the second quarter when net outflows amounted to EUR 53 billion. On the other hand, Europe registered net outflows of EUR 31 billion, up from EUR 1 billion in the previous quarter.
At the end of the third quarter, assets of equity funds represented 37 percent and bond funds represented 24 percent of all investment fund assets worldwide. The asset share of money market funds was 16 percent and the asset share of balanced/mixed funds was 11 percent.
The market share of the ten largest countries/regions in the world market were the United States (49.3%), Europe (28.1%), Australia (5.7%), Brazil (5.5%), Japan (3.6%), Canada (3.5%), China (1.3%), Rep. of Korea (0.9%), South Africa (0.6%) and India (0.4%).
ING Investment Management has celebrated its third, consecutive BENCHMARK Fund of the Year Awards 2012 within the Asian Bond category. These awards are given to the funds that ranked highest across several performance criteria such as 1-, 3- and 5-year returns and 3-year Sortino Ratios. To qualify for the award, funds must have been ranked in the top 5 amongst peers in terms of total returns for the 12 months ending 31 October 2012.
ING IM EMD co heads Rob Drijkoningen and Gorky Urguieta stated:“We are very proud of this achievement and believe that this award proves our long term success in the Asian Bonds space and can be attributed to our dedicated investment approach and team spirit.”
ING Investment Management (ING IM) believes that investors will continue to recognize value in Asian fixed income helping the asset class perform relatively well in 2013.
Joep Huntjens, Portfolio Manager Asian Debt for ING IM in Singapore, says: “We believe that investors will continue to invest into the region to gain exposure to Asia’s strong fundamentals and relatively-attractive valuations. Asia continues to lead in terms of economic growth which is translating into increased wealth and domestic demand. As such, Asia’s reliance on exports is declining. Not only should sovereign fiscal situations remain healthy – particularly compared with Western countries – but this should provide a healthy operating environment for companies in the region. Asian currencies have upside potential from current levels, which provides an additional source of diversified returns for investors into Asian debt.”
The asset manager notes that the lower yields in developed markets, on the back of global growth deceleration, make Asian bond yields more attractive. Headline inflation is muted in most Asian economies, though may inch higher as growth accelerates. In any event, it will not be a major concern for bond investors. ING IM predicts that Asian growth is likely to have troughed and should pick up modestly from current levels. Likewise, it also anticipates that corporate earnings will improve from 2012, making it a good environment for bond investing despite low levels of yields.
Joep Huntjens concludes: “We expect structural inflows into the asset class to continue, which will support yields at current levels. While yields have declined over the course of 2012, we still see value opportunities in select corporate and sovereign issues and issuers. As such, we think 2013 will be a good year for bonds in general and a better year for investment managers that excel at security selection. Investments do not come without risks of course. The primary risks we see stem from events beyond our region, such as the US fiscal situation. Events such as these can put pressure on credit, but such downward moves in prices tend to
Nineteen funds have seen huge improvements in their FE Crown Fund Rating scores since they were last rebalanced in July 2012. In the latest set of results 12 funds climbed the rankings from one to four FE Crowns, while 14 funds rose from two to five FE Crowns.
The biggest leap from one to five FE Crowns was achieved by five funds:
JP Morgan Multi Manager Growth
EFA Clarion Explorer Portfolio Return
Sentinel Enterprise Portfolio
Henderson UK Property
CF Ruffer Pacific
CF Ruffer Pacific saw the most dramatic improvement, delivering the highest alpha of all funds in the Specialist sector. Henderson UK Property generated much improved outperformance with significantly lower volatility.
Funds were judged according to their three year track records to 31 December 2012 and ranked according to alpha generation, volatility and the consistency with which they have beaten their benchmarks. The top 10% of funds were awarded five FE Crowns and the > following 15% received four FE Crowns.
Seven funds achieved the top rank of five FE Crowns in their first rating (funds must have a three year track record to be rated):
Henderson European Special Situations
CIS Sustainable Diversified
Newton Managed Income
CIS Sustainable World Trust
Santander Investment Income Portfolio
Evenlode Income
Santander Sterling Government Bond
The three mixed investment strategies – CIS Sustainable Diversified, Newton Managed Income and CIS Sustainable World Trust – as well as Santander Sterling Government Bond scored particularly highly for their ability to deliver alpha and beat their benchmarks.
Evenlode Income kept volatility low compared to peers in the UK Equity Income sector, while Santander Sterling Government Bond was one of the most consistent performers within the UK Gilt sector.
Tim Wilson who runs Newton Managed Income, Mike Fox at the helm of CIS Sustainable World Trust and Richard Pease, manager of the Henderson European Special Situations Fund, are FE Alpha Managers – recognized as being within the top 10% of the UK’s fund managers.
Rob Gleeson, Head of FE Research, said: “The current rebalancing saw, as expected, an above average movement in the FE Crown Fund Ratings scores, with several funds seeing big improvements or significant downgrades. The undulation of recent years, with a post credit crunch rally followed by another correction in 2011 and the strong performance last year, has made it a difficult environment for funds; with both aggressive and defensive strategies doing well at various times over the last three years. The movement in the ratings this time round show the re-emergence of growth strategies as the dominant source of returns.”
BlueMountain Capital Management (BlueMountain), a private investment firm with over$12 billion in assets under management, is pleased to announce that James E. (“Jes”) Staley will join the firm as its ninth Managing Partner. Mr. Staley joins the firm from J.P. Morgan, where he recently served as CEO of the investment banking division. Along with becoming an integral part of the executive team, Mr. Staley will focus on cultivating relationships and developing new strategies that harness BlueMountain’s strengths, capture opportunities in the market, and deliver them to clients.
“Jes is one of the most experienced and successful leaders in the industry and has played a key role at one of the world’s most successful financial institutions. Not only has he had a front row seat for the evolution of the financial industry, but he’s also one of the most ethical people we’ve worked with,” said Andrew Feldstein , CEO and Chief Investment Officer of BlueMountain. “He shares our enthusiasm for the scale of the opportunities that exist in the market and the unique value proposition that BlueMountain delivers to its clients.”
Mr. Staley will join BlueMountain after more than 34 years at J.P. Morgan, where he served in various executive positions within the bank including heading both the Investment Bank and J.P. Morgan Asset Management. Prior to running the bank’s asset management division, Mr. Staley served as the head of J.P. Morgan’s private bank and was one of the founders of J.P. Morgan’s equities business.
Mr. Staley will join BlueMountain’s Management Committee, its Risk Committee and its Investment Committee and will purchase a stake in the firm. Proceeds from the sale will be invested in new infrastructure, technology and talent.
“I’m very excited to be joining BlueMountain at a time when sea changes in the financial industry combined with the firm’s unique strengths open up enormous possibilities to deliver value to clients,” said Mr. Staley. “I want to thank all my colleagues at J.P. Morgan, my home for the last 34 years, and I look forward to working with them in the future.”
Foto: BIS photo gallery. Basilea III aprueba un calendario gradual para implantar el ratio de liquidez
The LCR will be introduced as planned on 1 January 2015, but the minimum requirement will begin at 60%, rising in equal annual steps of 10 percentage points to reach 100% on 1 January 2019. This graduated approach is designed to ensure that the LCR can be introduced without disruption to the orderly strengthening of banking systems or the ongoing financing of economic activity.
The Basel Committee has issued the full text of the revised Liquidity Coverage Ratio (LCR) following endorsement on 6 January 2013 by its governing body – the Group of Central Bank Governors and Heads of Supervision (GHOS).
2015
2016
2017
2018
2019
Minimum LCR requirement
60%
70%
80%
90%
100%
The GHOS agreed that, during periods of stress it would be entirely appropriate for banks to use their stock of HQLA, thereby falling below the minimum. Moreover, it is the responsibility of bank supervisors to give guidance on usability according to circumstances.
The GHOS also agreed that, since deposits with central banks are the most – indeed, in some cases, the only – reliable form of liquidity, the interaction between the LCR and the provision of central bank facilities is critically important. The Committee will therefore continue to work on this issue over the course of 2013.
Mervyn King, Chairman of the GHOS and Governor of the Bank of England, said, “The Liquidity Coverage Ratio is a key component of the Basel III framework. The agreement reached today is a very significant achievement. For the first time in regulatory history, we have a truly global minimum standard for bank liquidity. Importantly, introducing a phased timetable for the introduction of the LCR, and reaffirming that a bank’s stock of liquid assets are usable in times of stress, will ensure that the new liquidity standard will in no way hinder the ability of the global banking system to finance a recovery.”
The LCR is an essential component of the Basel III reforms, which are global regulatory standards on bank capital adequacy and liquidity endorsed by the G20 Leaders.
The LCR is one of the Basel Committee’s key reforms to strengthen global capital and liquidity regulations with the goal of promoting a more resilient banking sector. The LCR promotes the short-term resilience of a bank’s liquidity risk profile. It does this by ensuring that a bank has an adequate stock of unencumbered high-quality liquid assets (HQLA) that can be converted into cash easily and immediately in private markets to meet its liquidity needs for a 30 calendar day liquidity stress scenario. It will improve the banking sector’s ability to absorb shocks arising from financial and economic stress, whatever the source, thus reducing the risk of spillover from the financial sector to the real economy.
The LCR was first published in December 2010. At that time, the Basel Committee put in place a rigorous process to review the standard and its implications for financial markets, credit extension and economic growth. It committed to address unintended consequences as necessary.
The revisions to the LCR incorporate amendments to the definition of high-quality liquid assets (HQLA) and net cash outflows. In addition, the Basel Committee has agreed a revised timetable for phase-in of the standard and additional text to give effect to the Committee’s intention for the stock of liquid assets to be used in times of stress. The changes to the definition of the LCR, developed and agreed by the Basel Committee over the past two years, include an expansion in the range of assets eligible as HQLA and some refinements to the assumed inflow and outflow rates to better reflect actual experience in times of stress.
Once the LCR has been fully implemented, its 100% threshold will be a minimum requirement in normal times. During a period of stress, banks would be expected to use their pool of liquid assets, thereby temporarily falling below the minimum requirement. The GHOS agreed that the LCR should be subject to phase-in arrangements which align with those that apply to the Basel III capital adequacy requirements.
Foto: Brian Katt. BofA acuerda pagar 10.300 millones de dólares a Fannie Mae para resolver demandas sobre créditos hipotecarios
Bank of America announced on Monday agreements with Fannie Mae to resolve outstanding and potential repurchase and certain other claims relating to the origination, sale and delivery of substantially all residential mortgage loans originated and sold directly to Fannie Mae from January 1, 2000 through December 31, 2008 by entities related to Countrywide Financial Corporation (legacy Countrywide) and Bank of America, National Association (BANA).
In addition, Bank of America announced that it signed definitive agreements to sell the servicing rights on 2.0 million residential mortgage loans totaling approximately $306 billion, as measured by the aggregate unpaid principal balance (as of November 30, 2012).
“As we enter 2013, we sharpen our focus on serving our three customer groups and helping to move the economy forward,” said Bank of America Chief Executive Officer Brian Moynihan. “Together, these agreements are a significant step in resolving our remaining legacy mortgage issues, further streamlining and simplifying the company and reducing expenses over time.”
Fannie Mae agreements
The agreements with Fannie Mae cover loans with an aggregate original principal balance of approximately $1.4 trillion and an aggregate outstanding principal balance of approximately $300 billion. Unresolved claims by Fannie Mae for alleged breaches of selling representations and warranties with respect to these loans totaled $11.2 billion of unpaid principal balance at September 30, 2012. These agreements extinguish substantially all of those unresolved claims, as well as any future representations and warranties claims associated with loans sold directly to Fannie Mae from January 1, 2000 to December 31, 2008, subject to certain exceptions which Bank of America does not expect to be material.
As part of the agreement to settle representations and warranties claims, Bank of America will make a cash payment to Fannie Mae of $3.6 billion and also repurchase for $6.75 billion certain residential mortgage loans sold to Fannie Mae, which Bank of America has valued at less than the purchase price. These actions are expected to be covered by existing reserves and an additional $2.5 billion (pretax) in representations and warranties provision recorded in the fourth quarter of 2012.
Bank of America also agreed to make a cash payment to Fannie Mae to settle substantially all of Fannie Mae’s outstanding and future claims for compensatory fees arising out of past foreclosure delays. This payment is expected to be covered by existing reserves and an additional provision of $260 million (pretax) recorded in the fourth quarter of 2012.
Together, these actions described above are expected to reduce Bank of America’s pretax income by approximately $2.7 billion in the fourth quarter of 2012.
The Fannie Mae agreement also clarifies the parties’ obligations with respect to mortgage insurance, including by establishing timeframes for certain payments and other actions, as well as parameters for potential bulk settlements and by providing for cooperation in future dealings with mortgage insurers.
Through these actions, Bank of America is addressing substantially all of its remaining exposure to repurchase obligations for residential mortgage loans sold directly to Fannie Mae. After giving effect to the settlement agreements with Fannie Mae announced today, the company expects to reduce the range of possible loss above existing accruals for both GSE and non-GSE representations and warranties exposures to up to $4.0 billion at December 31, 2012, compared to up to $6.0 billion at September 30, 2012.
Sale of mortgage servicing rights
Bank of America also announced that it signed definitive agreements with two different counterparties to sell the servicing rights on certain residential mortgage loans serviced for Fannie Mae, the Federal Home Loan Mortgage Corporation (Freddie Mac), the Government National Mortgage Association (Ginnie Mae), and private label securitizations, with an aggregate unpaid principal balance of approximately $306 billion. Transfers of servicing rights are subject to the approval or consent of certain third parties.
The sales involve approximately 2 million loans currently serviced by Bank of America, including approximately 232,000 loans classified as 60+ day delinquent first mortgage loans.
Prior to the above transactions, the number of loans classified as 60+ day delinquencies was approximately 775,000 loans as of December 31, 2012, down from 936,000 loans at September 30, 2012. Upon completion of these servicing transfer transactions, the number of 60+ day delinquent first mortgage loans serviced by Bank of America is expected to further decline substantially.
The transfers of servicing rights are scheduled to occur in stages over the course of 2013. The transactions are expected to have a benefit over the book value of the mortgage servicing rights of approximately $650 million; about one-half of this amount is expected to be recorded in the fourth quarter of 2012 related to valuation adjustments to the MSR asset, with the balance expected to be recorded in future periods at the time of servicing transfers.
“We are resolving legacy mortgage issues while balancing the needs of our customers, mortgage investors, our shareholders and communities. The sale of mortgage servicing rights to highly rated specialty servicing companies is an important step in that process,” said Ron Sturzenegger, Legacy Asset Servicing executive for Bank of America. “Bank of America will work closely with our customers, buyers and the investors who own the loans to ensure a smooth transition to their new servicer. Importantly, each of these specialty servicers has committed to adhere to the same servicing standards as provided under the National Mortgage Settlement.”
Other items expected to impact fourth-quarter 2012 results
In addition to the mortgage-related items discussed above, Bank of America expects its fourth-quarter 2012 financial results to be negatively impacted by approximately $2.5 billion (pretax) for the independent foreclosure reviews, litigation (primarily mortgage-related), and other mortgage-related matters. Results for the fourth quarter of 2012 are also expected to include approximately $700 million of pretax negative debit valuation adjustments (DVA) and fair value option (FVO) adjustments related to the continued improvement in the company’s credit spreads.
In addition to the net tax benefit of the above items, results are also expected to be positively impacted by a benefit of $1.3 billion, primarily related to an income tax benefit from the recognition of foreign tax credits made available from the restructuring of certain non-U.S. subsidiaries. The aforementioned tax effects have no net impact on regulatory capital during the fourth quarter of 2012.
Taking into account the effects of all the items above, Bank of America expects earnings per share to be modestly positive for the fourth quarter of 2012. Bank of America is scheduled to report fourth-quarter 2012 financial results on January 17, 2013.
Photo: Franzfoto . Calamos Reopens Growth and Income Fund, Global Growth and Income Fund to New Investors
Calamos Investments announces the Calamos Growth and Income Fundand the Calamos Global Growth and Income Fund are reopened to new accounts and new investments as of January 2, 2013.
“We are pleased that the Calamos Growth and Income Fund and Calamos Global Growth and Income Fund are again open to new investors. The Calamos Growth and Income Fund and Calamos Global Growth and Income Fund are actively managed funds that offer upside participation in the equity market with historically less exposure to the downside than equity-only portfolios over full market cycles,” said John P. Calamos, Sr. , Chief Executive Officer and Global Co-Chief Investment Officer of Calamos Investments.
They have demonstrated less volatility over the history of the funds as measured by beta, managing risk and reward over the course of many market cycles
“Since their inceptions, each of these funds has exhibited lower volatility by employing a flexible approach utilizing primarily equity-linked and convertible securities to respond to changing, volatile markets and investment opportunities. Guided by the best interests of our current fund shareholders, Calamos has continued to evaluate market opportunities consistent with each fund’s investment objective and strategy, and to navigate the current equity market volatility based on managing a consistent risk/reward profile. As global economic recovery has continued and equity markets trend up, our team is seeing increased opportunities in the convertible market. The funds’ flexibility to create synthetic convertibles also enhances the opportunity to achieve the funds’ investment objectives. At this time we believe that reopening the funds allows us to seek to take advantage of a broader opportunity set that reflects our top-down macro view going into 2013,” said Calamos.
The Calamos Growth and Income Fund and the Calamos Global Growth and Income Fund have demonstrated less volatility over the history of the funds as measured by beta, managing risk and reward over the course of many market cycles. The funds invest in a combination of instruments, including equity-linked and convertible securities, synthetic convertibles, stocks and fixed income to seek to achieve each fund’s investment objective and risk/reward for current market conditions.
Calamos Investments is a diversified global investment firm offering innovative investment strategies including equity, fixed income, convertible and alternative investments, among others. The firm offers strategies through separately managed portfolios, mutual funds, closed-end funds, private funds and UCITS funds. Clients include major corporations, pension funds, endowments, foundations and individuals. Headquartered in the Chicago metropolitan area, the firm also has offices in London and New York. Calamos serves professional/sophisticated investors around the world through Calamos Global Funds plc (UCITS), distributed by Calamos Investments LLP, London, United Kingdom.
Calamos Investments announces the Calamos Growth and Income Fund and the Calamos Global Growth and Income Fund are reopened to new accounts and new investments as of January 2, 2013.
“We are pleased that the Calamos Growth and Income Fund and Calamos Global Growth and Income Fund are again open to new investors. The Calamos Growth and Income Fund and Calamos Global Growth and Income Fund are actively managed funds that offer upside participation in the equity market with historically less exposure to the downside than equity-only portfolios over full market cycles,” said John P. Calamos, Sr., Chief Executive Officer and Global Co-Chief Investment Officer of Calamos Investments.
They have demonstrated less volatility over the history of the funds as measured by beta, managing risk and reward over the course of many market cycles.
“Since their inceptions, each of these funds has exhibited lower volatility by employing a flexible approach utilizing primarily equity-linked and convertible securities to respond to changing, volatile markets and investment opportunities. Guided by the best interests of our current fund shareholders, Calamos has continued to evaluate market opportunities consistent with each fund’s investment objective and strategy, and to navigate the current equity market volatility based on managing a consistent risk/reward profile. As global economic recovery has continued and equity markets trend up, our team is seeing increased opportunities in the convertible market. The funds’ flexibility to create synthetic convertibles also enhances the opportunity to achieve the funds’ investment objectives. At this time we believe that reopening the funds allows us to seek to take advantage of a broader opportunity set that reflects our top-down macro view going into 2013,” said Calamos.
The Calamos Growth and Income Fund and the Calamos Global Growth and Income Fund have demonstrated less volatility over the history of the funds as measured by beta, managing risk and reward over the course of many market cycles. The funds invest in a combination of instruments, including equity-linked and convertible securities, synthetic convertibles, stocks and fixed income to seek to achieve each fund’s investment objective and risk/reward for current market conditions.
Calamos Investments is a diversified global investment firm offering innovative investment strategies including equity, fixed income, convertible and alternative investments, among others. The firm offers strategies through separately managed portfolios, mutual funds, closed-end funds, private funds and UCITS funds. Clients include major corporations, pension funds, endowments, foundations and individuals. Headquartered in the Chicago metropolitan area, the firm also has offices in London and New York. Calamos serves professional/sophisticated investors around the world through Calamos Global Funds plc (UCITS), distributed by Calamos Investments LLP, London, United Kingdom.
Photo: Sandip Dey, via Wikimedia Commons. Why Do Investors Turn Their Backs on Emerging Markets?
The IMF has projected emerging markets GDP growth at around 5.4% during 2012 and 2013, about 4% higher than the more advanced economies”. Nonetheless, investor money is not pouring into emerging markets. Why are investors turning their back on these economies? … Continuar leyendo
