2024 Will Be Better for Buyers

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Despite slower home price growth, affordability will be the biggest challenge for homebuyers in 2024, according to the Bright MLS 2024 Housing Forecast. However, more  buyers and sellers will return to the market in the coming year as interest rates fall from 22-year highs, and homeowners begin to loosen their grip on 3% mortgage rates as life events prompt more people to move. The result will be more options for home shoppers and a rise in home sales, though market activity is still projected to remain well below typical levels.

As we look towards the real estate market in 2024, there are several key trends and predictions outlined by the Bright MLS forecast that buyers and sellers should be aware of. Firstly, a significant change is anticipated in mortgage rates. These rates are expected to establish a new normal, dropping below 7% in the first quarter of the year.

As the year progresses, they are predicted to fluctuate between 6-6.5%, eventually settling at around 6.2% by the end of the year. This shift in mortgage rates is crucial for both buyers and sellers as it directly impacts affordability and the overall cost of purchasing a home.

Another important aspect to consider is the expected movement in the housing market regarding sales and inventory. The forecast suggests a rebound in existing home sales, which are projected to conclude the year at 4.6 million. This marks a significant 12.1% increase from the low numbers recorded in 2023, though it’s still below the sales numbers typically seen in a regular year. Furthermore, the market is likely to witness more sellers entering due to changing family and financial circumstances. This influx of sellers is anticipated to boost the inventory by 7.6% by the end of 2024. An increase in inventory, coupled with a rise in the number of buyers, is expected to maintain stability in home prices.

Finally, the forecast addresses the dual aspects of affordability challenges and the impact of new home supplies on the market. Despite a general trend of stability in home prices, with the median price in the U.S. expected to rise marginally by 1.5% to $394,200, there are nuances to be aware of.

The growing affordability issues, combined with an increase in the supply of new homes, are likely to lead to a decrease in home prices in specific markets. This trend will be particularly evident in areas like California and Florida. Therefore, both buyers and sellers in these regions need to be particularly mindful of these localized market dynamics when making their real estate decisions in 2024.

“After a very difficult market for buyers who have had to contend with an atypical housing market in 2023, home shoppers will find more listings to choose from in 2024, ” Lisa Sturtevant, Bright MLS Chief Economist said. “At the same time, both buyers and sellers will have to reset expectations next year for persistently higher mortgage rates and more negotiations during the transaction.”

Key 2024 housing trends and the wildcards

A slower start to the spring homebuying season: Although home sales are expected to increase in 2024, Bright MLS’ forecast calls for home sales to remain low in the first quarter of the year, as rates remain around 7% and some prospective buyers will wait, holding out for lower rates later in the year.

“Life happens” will force homeowners out of their sub-3% loans: With nearly two-thirds of U.S. homeowners holding onto a mortgage rate below 4% and rates currently well above 7%, there has been little incentive to sell.  However, as rates begin to fall and move closer to 6.5%, homeowners who have been characterized as being “locked in” to their mortgage will increasingly find that changing family and financial circumstances outweigh their low rates. This will lead to more  new listings over the course of the year. Inventory will still be below pre-pandemic levels, though the gap will have narrowed so that nationally year-end 2024 inventory will be at 92% of the year-end 2019 level.

Affordability will continue to challenge buyers: Several factors will push and pull at home prices in 2024. More inventory will be generally offset by more buyers in the market. This will keep home prices stable in many markets. But affordability, which worsened significantly over the past year as both mortgage rates and home prices were rising, is going to continue to be a challenge in 2024, particularly for first-time homebuyers. Sellers looking to attract these buyers may need to offer closing cost assistance or other financial incentives to make the numbers work for those in the market for the first time.

Buyers waiting for a major price correction should not hold their breath: There is no evidence to suggest that there will be major, widespread home price corrections in 2024. However, in markets where home prices escalated during the pandemic or where new single-family construction is adding significantly to inventory, buyers could see home prices fall below 2023 levels. Conversely, markets where home prices have been rising in line with wages and inventory remains low, prices will continue to rise in 2024 (see the lists of markets with the largest forecasted increases and decreases below).

Wildcards that could shake up the housing market: The housing market has been anything but predictable in recent years, and there is a risk that political or economic factors could bring the unexpected to the housing market in 2024. Right now, the outlook is for a mild and short recession in 2024, which will not have a major impact on the housing market. However, ongoing global conflicts could increase the U.S. recession risk. Government standoffs and political discord at home can also lead to more consumer anxiety.

J.P. Morgan Private Bank releases 2024 Global Investments Outlook

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J.P. Morgan Private Bank released its 2024 Global Investments Outlook, After the Rate Reset: Investing Reconfigured, which defines five important considerations for investors as they navigate the dynamics of today’s new interest rate environment.

“Markets have entered an entirely new interest rate regime,” said Grace Peters, Global Head of Investment Strategy at J.P. Morgan Private Bank. “Three years ago, nearly 30% of all global government debt traded with a negative yield. It seemed the era of super-low interest rates might never end, but it did.”

“As we head into a new year, it’s time for investors to think about their investing goals and how they must adapt to – and even capitalize on – this market environment,” said Clay Erwin, Global Head of Investments Sales & Trading at J.P. Morgan Private Bank. “The rise in global bond yields is not just historic—it may mark a once in a generation entry point for investors that might not be available a year from now.”

To harness the new dynamics of a 5% rate world, J.P. Morgan Private Bank’s 2024 Investment Outlook explores five important themes.

Inflation will likely settle – you should still hedge against it.

“Compared to this time last year, the inflationary outlook is far less bleak. However, we think that 2% mandate will become the inflation floor, not the ceiling. Therefore, investors still need to prepare for a higher inflation world, just not as high as we’ve experienced recently,” said Erwin.

To grapple with the prospect of more meaningful inflation in 2024 and beyond, investors might first look to equities. Public companies may continue to maintain both pricing power and their margins.

Moreover, while investors used bonds to help insulate portfolios from slower growth in the previous cycle, the 2024 Outlook notes that investors should consider an allocation to real assets as an inflation hedge for the cycle ahead.

The cash conundrum: the benefits and risks of holding too much.

Low volatility and 5% yields on cash have been a magnet for J.P. Morgan Private Bank’s clients, who are holding significantly more cash than they did two years ago, having added at least $120 billion more in more in short term money market funds and treasury bills. This trend is global, but particularly powerful in the U.S. where clients have over twice the allocation to short-term treasuries and money markets as their peers outside the U.S.

“It feels good to hold cash when rates are high and other markets are this volatile,” said Jacob Manoukian, U.S. Head of Investment Strategy at J.P. Morgan Private Bank. “Cash works best relative to stocks and bonds in periods when interest rates are rising quickly, and investors question the durability of corporate earnings growth. But we think this is as good as it gets for cash.”

Bonds are competitive with stocks – adjust the mix according to your ambitions.

While there has been a painful stretch for bondholders this year, the new rate regime represents a reset in bond market pricing, and core bonds may now be poised to deliver strong forward-looking returns. Relative to stocks, bonds haven’t looked this attractive since before the Global Financial Crisis. Despite this, four out of every five J.P. Morgan Private Bank clients have not materially increased their allocation to fixed income over the last two years.

“We look to bonds to provide stability and income. Given the recent increase in yields, from our view bonds are now well positioned to deliver on both fronts,” added Manoukian.

With AI momentum, equities seem to be on the march to new highs.

Equities offer the potential for meaningful gains in 2024. Even as economic growth slows amid higher rates, large-cap equity earnings growth should accelerate and may propel stock markets higher over the next year.

“We believe the U.S. large-cap corporate sector has gone through an earnings recession already, with eight of the eleven major sectors in the S&P 500 having reported negative earnings growth for two or more consecutive quarters over the last two years. These companies have emerged leaner and resilient to potential challenges that 2024 could present,” noted Christopher Baggini, Global Head of Equity Strategy at J.P. Morgan Private Bank.

Investors don’t seem to have missed the valuation opportunity. While the S&P 500 trades at an above average valuation, there is a substantial discount to be found in U.S. mid and small-caps as well as European and emerging market stocks. Additionally, the promise of artificial intelligence and the potential upside in the stocks of drug makers with a growing share of the weight loss market also provide an attractive opportunity for investors looking into next year.

On regional opportunities, Alex Wolf, Asia Head of Investment Strategy at J.P. Morgan Private Bank, considers Indian equities a bright spot for 2024.

“In India, corporate earnings have kept pace with GDP growth – a rarity in emerging economies. Indian company profits, and thus stock returns, have tended to grow in line with nominal GDP,” notes Wolf. “Data over the past twenty years show that India has one of the closest relationships between economic growth and market returns.”

Pockets of credit stress loom, but they will likely be limited.

The next year could see stress in certain sectors of the credit complex. For example, commercial real estate loans, leveraged loans, and some areas of consumer credit – like autos and credit card – and high yield corporate credit could be vulnerable.

“An inescapable fact of the business cycle is that higher interest rates make credit harder to come by. We think these stresses will be manageable, and not enough to cause a recession in 2024,” added Peters.

Learn more about J.P. Morgan Private Bank’s 2024 Global Investments Outlook and download the full report here.

iBusiness Funding Unveils a Collection of AI Chatbots Transforming SBA Lending for Banks and Credit Unions

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iBusiness Funding announced the launch of LenderAI Prodigy which introduces an innovative collection of AI chatbots inside their flagship end-to-end SBA software solution, LenderAI.

The first chatbot iBusiness Funding has implemented helps users navigate the SBA’s Standard Operating Procedures (SOP) quickly and accurately. A user can ask the chatbot any SBA-related question, and the bot will respond with the correct answer as per the SOP.  It also cites the specific section it is referencing in the SOP for the user. Originally developed for and successfully utilized internally by iBusiness Funding, it is now available to all LenderAI clients within the new Prodigy feature.

This functionality showcases iBusiness Funding’s expertise with AI as well as their commitment to testing and refining technology internally before bringing it to the market, the firm said.

“The SOP chatbot was a game changer for our internal teams, enabling us to navigate the complexities of the SBA’s SOP with ease. Seeing its impact, we knew it was essential to adapt and offer this powerful tool to our clients,” said Justin Levy, CEO of iBusiness Funding. “You can ask the bot things like ‘How do I release collateral in loan servicing,’ ‘Please chart the maximum rates of SBA loans,’ or a myriad of other questions that commonly come up when processing SBA loans and get an accurate answer instantly.” With its ability to provide fast, reliable answers, this tool significantly reduces the time and effort it takes financial institutions to find information. It is also updated frequently to reflect any updates or changes to the SOP.

First in Market and Future Developments

As the first AI tool of its kind in the market, LenderAI Prodigy underscores iBusiness Funding’s role as an innovator in the financial technology and artificial intelligence spaces. The next chatbot to be released will provide lenders using LenderAI with a customized chatbot reflecting their own specific credit policies and guidelines that their staff can use internally. This will make it easier than ever for lenders to ensure their employees can quickly and easily understand their own guidelines and policies by relying on a single source of truth. Additional chatbots are in development, promising to further enhance LenderAI’s capabilities.

“Our goal with the first chatbot inside the Prodigy feature is to empower banks and credit unions with a tool that not only saves time but also ensures accuracy and compliance with the latest SOP updates. Our chatbot is future-proof and updated as changes are introduced to the SOP, ensuring our clients have peace of mind knowing that the answers they receive to their questions are always correct,” added Mr. Levy.

Offshore Investments Have an Assured Place in the Andean and Mexican Pension Systems

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Momentum to overhaul the AFPs pension systems in the Andes has stalled amid dwindling public support for the ruling parties in Chile, Colombia, and Peru, fortifying opportunities for external managers. Asset managers with private equity or other alternatives will find opportunity to capitalize on pension fund appetite for long-term, low-volatility products with low correlation to existing benchmarks, according to Cerulli’s report, Latin American Distribution Dynamics 2023: Latin America’s Leftward Tilt and Its Impact on Retail and Institutional Asset Gathering.

According to the research, produced in conjunction with Cerulli’s research partner for Latin America, Latin Asset Management, Chilean AFP holdings of cross-border funds and ETFs total $73 billion, Colombian $40 billion, and Peruvian at $8.6 billion.

“Despite calls by recently elected left-leaning populists in Chile, Colombia, and Peru to limit the participation of privately owned managers in the pension sphere, broad-based drastic reforms are being rejected in the region”, the report added.

“There’s consensus in the Andes that the region’s pension systems need to be updated in order to improve payouts for retirees, as well as include others who did not contribute to the system during their working years, but there’s little appetite for eliminating the AFPs or returning pension systems to state control,” states Thomas Ciampi, director of Latin Asset Management and author of the report.

While government-mandated emergency withdrawals in Chile and Peru dissuaded AFPs from locking up assets in long-term vehicles such as a real estate development or infrastructure projects, they have since increasingly allocated to alternatives as the response to COVID-19 has ended.

Including Mexican Afores, alternatives penetration in the AFP/Afore pension fund segment jumped to $71 billion in mid-2023, from $46 billion at the close of 2020. Excluding Mexico, the increase was more moderate—to $36 billion from $27 billion over the same period. “Peruvian and Mexican private-pension managers are already allocating a larger percentage of their portfolios to alternatives than to cross-border mutual funds and ETFs,” remarks Ciampi.

External managers have secured their place in the AFP system for now, but the challenges they face in the pension segment—attractive yields on local, onshore fixed-income securities, and the uncertainty surrounding the future of the AFP—will continue to loom. Managers that offer exposure to alternatives such as private debt, private equity, and real estate will be better positioned for mandate wins.

Citi Leads Strategic Investment Round in Colombian Fintech Supra

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Citi has led a strategic investment round in Supra. Far Out Ventures and H20 Capital also participated in the financing round.

Supra is a Colombian fintech that enables cross-border payments and treasury solutions for small and medium-sized businesses (SMBs) that participate in import and export activities.

The new capital will enable the growth of Supra’s Colombian operations to fulfil its payment aggregator role in partnership with Foreign Exchange Market Intermediaries (IMC) and licensed Payment Service Providers.

Diego Santoyo, Head of Corporate Sales and Solutions for the Andean region at Citi, said: “Citi’s best-in-class cross-border payments and FX technology will help enable Supra’s operations and expansion in Colombia.”

“At Supra, we are developing cutting-edge cross-border payment solutions that provide value-added services to our clients as well as transaction speed and highly competitive rates. Our technology is one of the first in the country that complies with the regulations issued by the Colombian Central Bank for payment aggregators,” said Emilio Pardo, CEO and co-founder of Supra.

In Colombia, more than 40,000 companies participate in import and export commercial activities and the market for business-to-business cross border payments in 2022 was approx. $134 billion according to data from the Colombian Tax Authorities (DIAN).

The investment was led by Citi’s strategic investments arm, which invests in innovative fintech companies that are aligned to Citi’s core businesses.

“We believe Supra’s product, business model and collaboration with Citi will allow them to create competitive moats in the multi-billion-dollar import and export cross-border payments market in Colombia,” said Aldo Alvarez, Lead for LatAm Strategic Investments in Citi’s Markets business.

 

H.I.G. Capital Completes Acquisition of Mainline

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Boreal Capital Management Roberto Vélez Miami

H.I.G. Capital announced that one of its affiliates has completed the acquisition of Mainline Information Systems, a leading IT solutions provider. Mainline’s management team, headed by CEO Jeff Dobbelaere, will continue to lead the Company.

Headquartered in Tallahassee, FL, and with revenues in excess of $1 billion, Mainline is a leading, diversified IT solutions provider serving the infrastructure needs of blue-chip enterprises. Founded in 1989, the Company designs and implements custom IT solutions for enterprises and provides associated professional and managed services. Mainline has leveraged its technical data center expertise, diverse partner network, and consultative customer-centric approach to become a leading provider of enterprise server, hybrid cloud, cyber storage, and network & security solutions.

“Over the past 30 years, Mainline has developed strong and enduring relationships by providing our customers with some of their most complex and mission critical infrastructure solutions. Mainline has become a clear industry leader and is incredibly well positioned to continue to drive business outcomes for our clients as the technology landscape evolves,” said Jeff Dobbelaere. “I am very excited to partner with H.I.G. and look forward to investing in the significant growth opportunities which can take the company to new heights.”

Aaron Tolson, Managing Director at H.I.G., commented, “Mainline’s technical expertise, its status as a trusted advisor for its customers, and the value it brings to its Original Equipment Manufacturer partners are unmatched in the IT industry. We have been very impressed by what Jeff, and the rest of the management team have built and look forward to helping the Company further accelerate its significant growth potential through organic initiatives and acquisitions.”

H.I.G. was advised by Guggenheim Securities LLC, UBS, and Latham & Watkins LLP. The Company was advised by Highlander Advisors and King & Spalding.

The End of Declining Capital Intensity

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Photo courtesyRobert M. Almeida, Global Investment Strategist at MFS

The inflation ambush of 2022 ended a decades-long downward trajectory for interest rates. While rates may fall a bit as the effects of tight financial conditions weigh on aggregate demand and economic growth, we don’t believe the cost of capital going forward will resemble anything like the levels of recent years when central banks artificially set market prices via quantitative easing. Just as water ultimately finds its own level, in my opinion, interest rates will find their own, higher level.

As a result of higher capital costs, companies will find it challenging to meet investor expectations. In past notes, we have argued this is part of a large paradigm shift from high and easy-to-earn returns on capital to something lower and harder. While higher borrowing costs are the most notable change, they are not the only factor driving the paradigm shift. This note focuses on one of the other factors: a secular increase in capital expenditures and what this may mean to profits.

Falling capital intensity was the past

Globalization, in particular China’s emergence on the global scene in the mid-1990s as the low-cost manufacturer, was game changing. While it catapulted China from economic dormancy to the world’s second largest economy, its impact reached far beyond China as it allowed developed market companies to become de facto asset-light businesses by outsourcing their manufacturing to lower-cost locales.

Companies no longer needed to rebuild tangible capital because China, and Asia more broadly, did it for them. As a result, capital intensity (capital assets compared with revenues) steadily declined, as depicted below.

This matters because there is a long-term and inverse relationship between capital spending and return on capital. When capital intensity falls, all else equal, returns rise because less capital was deployed. Tangentially, the outsourcing of production also pressured operating expenses due to reduced need for human capital.

The combination of financial leverage by way of artificially-suppressed rates and falling fixed investment drove historic returns for shareholders. But that came at the expense of savers and labor, and exacerbated income inequality. Both trends have ended.

Rising capital intensity is the future

The pandemic, followed by the Russia-Ukraine war, exposed the risk of not having goods available for sale when customers want them. To make a car requires thousands of parts, but it only takes one missing part to halt production. For companies, having a product available on the shelf at a lower margin has become more important than an empty shelf at peak margin. While the building of semiconductor and electric vehicle factories has captured the bulk of the media attention, reshoring and added capacity has extended across electrical goods, chemicals, medical equipment and more. Companies outside of technology and the automotive industry are spending money too.

A brewing cold war between the US and China, and more recently a war in the Middle East, have made this risk even more acute. While the magnitude is uncertain, we can expect deglobalization to divert capital — which in recent years was returned to shareholders via dividends, stock buybacks and acquisitions — to fixed investment. That will likely become a drag on future returns.

Why this matters

While in the short run, trading impulses, such as monthly labor or inflation data, drive asset prices, in the long term, it’s return on capital that matters. Looking ahead, the shift from supply chain efficiency to resiliency will mean that companies that are short of tangible capital will need to make capital investments that will negatively impact returns.

Much like investors, companies are capital allocators. Their stock and bond prices are scorecards, voted on by the market. We’re exiting an environment where the consequences for bad decision-making were blunted by the tailwinds of artificially suppressed rates and globalization. And we’re entering one with a reduced margin for error.

Returns may prove resilient for companies led by great decision makers who understood that COVID-era cheap capital and stretched supply chains were unsustainable. However, companies with high capital needs and elevated debt burdens may disappoint. Since returns drive financial asset prices, this should also bring a paradigm shift in the importance of security selection and active management.

KKR Announces Promotions: 8 Partners and 33 Managing Directors Elevated

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KKR, a global investment firm, has marked the beginning of 2024 with significant promotions within its ranks. The firm announced the elevation of 8 of its members to Partner status and 33 to Managing Director positions, effective from January 1, 2024. This move underlines KKR’s commitment to recognizing and nurturing talent as part of its growth and evolution strategy.

Joe Bae and Scott Nuttall, Co-Chief Executive Officers at KKR, expressed their pride in this new chapter, highlighting the company’s nearly five-decade legacy of strengthening businesses and delivering consistent results to investors. They emphasized the importance of the firm’s culture and people, acknowledging the newly promoted individuals as embodiments of KKR’s values and dedication to client and portfolio company support.

The new Partners at KKR, recognized for their exemplary contributions, include Anne Arlinghaus from Capstone in New York, and James Gordon from the Infrastructure sector in London. Joining them are Franziska Kayser and Varun Khanna, both from London, with expertise in Private Equity and Credit & Markets, respectively. Keith Kim from Seoul, specializing in Infrastructure, and Prashant Kumar from Singapore, focusing on Private Equity, are also among the newly elevated. Completing the list of Partners are George Mueller from Credit & Markets in New York and Kugan Sathiyanandarajah from Health Care Strategic Growth in London.

In addition to the new Partners, KKR has also promoted a substantial number of professionals to the role of Managing Director. This diverse group brings expertise from various sectors and global locations, reflecting the firm’s wide-reaching influence. Among them are Mohamed Attar from Global Client Solutions in Dubai, Jonathan Bersch in Corporate Services and Real Estate from New York, and Rami Bibi from Global Impact in London. Also elevated are Ben Brudney, Zac Burke, and Daniele Candela, each with a strong background in Real Estate Equity, Global Macro, Balance Sheet & Risk, and Credit & Markets, respectively, all based in New York or London.

The promotions also span across various global locations such as Dublin, Houston, Tokyo, Sydney, San Francisco, and Mumbai, with professionals like Myles Carey, Todd Falk, Andrew Jennings, Gene Kolodin, Kensuke Kudo, and many others being recognized for their significant contributions to KKR’s diverse sectors including Infrastructure, Technology, Finance, and Real Estate.

This strategic move by KKR not only strengthens its global leadership but also signifies the firm’s dedication to fostering talent and expertise within its ranks. The promotions are a testament to the individual achievements of these professionals and KKR’s commitment to excellence in the investment sector. As KKR continues to navigate the complex global investment landscape, these leaders are poised to play pivotal roles in the firm’s ongoing success and growth.

The Battle of Passive vs. Active Reaches New Milestone

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Cerulli projections indicate that total passive mutual fund and exchange-traded fund (ETF) assets will surpass total active mutual fund and ETF assets by early 2024, according to U.S. Product Development 2023: Resource Reallocation Through Product Rationalization.

However, the flight toward passive may be slowing, as active management seeks ground in vehicles other than the mutual fund.

Approximately 10 years ago, passive mutual funds and ETFs were neck and neck in the asset race against each other, while they collectively held one-quarter of the marketshare of total mutual fund and ETF assets. Since then, passive assets in the two vehicles have stolen one to three percentage points of marketshare from actively managed assets each year, reaching 49% of marketshare as of the end of 2Q 2023, according Morningstar.

However, the gains in passive marketshare may not represent the full story. Passive management primarily exists only within mutual funds, ETFs, and collective investment trusts (CITs). According to the research, looking across mutual funds, ETFs, CITs, money markets, retail separately managed accounts (SMAs), and alternative structures, active management still holds 70% of marketshare as of the end of 2022 and the pace of outflows has slowed in recent years.

As the industry looks into the future, questions persist regarding how much marketshare passively managed assets will eventually control, and whether the trend toward passively managed assets will slow based on changing economic conditions and investor preferences. “Time will tell where the critical point exists upon which passive investing becomes a risk, where the mechanism of blindly buying securities based on their prices rather than their cash flow could blow back,” says Matt Apkarian, associate director.

Performance aside, the drivers of demand for active and passive are based on attitudes toward management styles, and the belief or lack of belief that active managers can outperform in various market environments or over full market cycles. Geopolitical shock (73%) and recession (69%) are the scenarios most believed to increase demand for active management, while a sustained equity bull market (50%) is the scenario most believed to decrease demand for active management.

“Expansion of strategies and allocations outside of the largest U.S.-based asset classes can stand to give support to active management, as assets appear to be on a path to continue moving into passively managed products within the portfolio core of U.S. equity and fixed income,” adds Apkarian.

“Asset managers must adapt to changing demand from financial advisors and end-investors to remain relevant in the industry. Increased focus on defined outcome products with better downside capture can serve to be the tool that meets advisor needs when attempting to provide their clients with a smooth ride toward their financial goals,” he concludes.

Insigneo Has Successfully Completed the Acquisition of PNC’s Latin American Brokerage and Advisory Business

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Insigneo has successfully completed the acquisition of the Latin American consumer brokerage and advisory accounts of PNC Investments, PNC Managed Account Solutions, and PNC Bank.

This strategic move, initially announced on August 22, 2023, represents an important milestone for Insigneo, as it expands its Mexican client base as well as its geographic footprint by establishing new offices in Texas.

This transaction underscores Insigneo’s commitment to international wealth management.

Insigneo has been gaining significant ground by emphasizing client service, leveraging state-of-the-art technology, and focusing on continuous innovation. Clients who were part of PNC’s Latin America brokerage and advisory business will now enjoy all the benefits of Insigneo’s focused global wealth management approach and international capabilities.

Raul Henriquez, Chairman, and CEO of Insigneo Financial Group, expressed his enthusiasm about the successful completion of the transaction, stating, “The acquisition of PNC’s Latin American brokerage and advisory business underscores Insigneo’s commitment to global wealth management. We recognize the importance and relevance of the Mexican market and see this as a strategic move to immediately establish a relevant presence in that market, while positioning Insigneo to harness new opportunities in the region.”

The closing of this transaction solidifies Insigneo’s leadership in the global wealth management industry. The company remains focused on its alternative business model while driving growth through successful strategic M&A activities, a commitment further underscored by the recent appointment of Carlos Mejia as Head of Mergers and Acquisitions.

Javier Rivero, President, and COO of Insigneo Securities and Insigneo International Financial Services, added, “Both parties worked diligently and efficiently during this time focused on a smooth transition. Insigneo welcomes all incoming employees, investment professionals, and their clients to our growing firm.”