Asset management

Lebanon gives Lazard bankers a brainteaser

28 Feb 2020

The debt-strapped nation has selected the firm to advise on a restructuring. But principal haircuts could imperil local banks, austerity would upset ordinary Lebanese, and Hezbollah’s growing power complicates everything. Lazard will be worth its fees if it can solve the puzzle.

Blackstone bets big on Boris British housing hedge

26 Feb 2020

The private equity giant is buying iQ Student Accommodation for $6 bln from Goldman Sachs in what it calls the biggest private UK real estate deal ever. It’s a play not on whether Brexit is a boom or a bust – but rather the continuing global allure of a proper English education.

Julius Baer gets off lightly for dirty money sins

20 Feb 2020

The Swiss finance watchdog demanded better controls and barred the bank from embarking on major deals for now. That’s mild punishment given the systematic failings that were uncovered but reflects limits on what the supervisor can do. The regulator could really use sharper teeth.

GAM does just enough to become a takeover target

20 Feb 2020

The Swiss asset manager saw profits fall 92% as a compliance scandal caused clients to pull funds. New CEO Peter Sanderson is pledging to cut costs and boost margins, but his targets look optimistic. Still, if Sanderson can steady the ship, GAM could look appealing to a buyer.

New UBS CEO is best answer to a difficult question

20 Feb 2020

The $50 bln group’s ideal successor to Sergio Ermotti would have experience running a big lender along with wealth management and investment banking chops. That’s a rarity. ING’s Ralph Hamers brings cost-cutting and tech savvy. Holland’s pay rules made him an affordable asset.

Merger of active asset managers looks too passive

18 Feb 2020

Franklin Templeton is acquiring Legg Mason for $4.5 bln. The deal beats the status quo with heavy pressure on industry margins, and both groups’ stocks got a boost. But it’s a defensive move that neither prioritizes aggressive cost cuts nor offers a clear path to growth.

Spain tweaks the odds on Blackstone’s property bet

18 Feb 2020

The left-wing coalition led by Pedro Sanchez wants to control rents on residential property. The move may depress house prices, up by one-quarter since 2014 thanks to a booming economy. Investors like Steve Schwarzman’s firm may be tempted to take some chips off the table.

Central banks help widen Brookfield’s moat of cash

13 Feb 2020

The Canadian asset manager’s client funds rose to $545 bln. Ultra-low interest rates help two ways: by pushing investors into alternative investments and inflating the value of assets like real estate. Its advantage will be tough for most rivals to overcome.

Europe’s baby BlackRock reaps Darwinian success

12 Feb 2020

Paris-listed money manager Amundi reported bumper 2019 profits as assets under management swelled to $1.8 trln. Its scale, broad business mix and savvy dealmaking should help CEO Yves Perrier leave rivals further behind. A valuation premium to peers is likely to grow.

Julius Baer CEO embraces bleaker wealth era

3 Feb 2020

Philipp Rickenbacher is calling a halt to the voracious asset gathering that fuelled the $11 bln Swiss group’s past growth. With negative interest rates, idle client cash can be a drag for private banks. Shifting focus to cost discipline is a necessary response to leaner times.

Lazard shows Wall Street is game of several halves

30 Jan 2020

The $5 bln advisory firm run by Ken Jacobs shrugged off a slow start to 2019 with record fourth-quarter revenue. It follows a growing tendency for its businesses to go in six-month cycles. As bumpy as that can make earnings, it’s a good warning to guard against complacency.

How Jamie Dimon can grab Larry Fink’s green halo

21 Jan 2020

Now that the BlackRock boss has got serious about climate change, the focus is on his JPMorgan peer. As CEO of the biggest U.S. bank, Dimon’s sway over corporate debt gives him more power than any equity activist. Deploying it would turn his bank from laggard to leader.

Inequality extends to hedge fund elite

20 Jan 2020

The top 20 managers like Ray Dalio and George Soros have made over $550 bln for investors over time. In part that’s longevity, but the group also raked in a third of industry gains in 2019 on under a fifth of assets. Most hedgies are still struggling to outrun cheap index funds.

Climate push matters to BlackRock’s earnings, too

15 Jan 2020

Investors want sustainability built into portfolios so Larry Fink, CEO of the $7.4 trln asset manager, sees an opportunity. That makes efforts to prod the corporate world more sustainable, and adds market-wide pressure to one-off campaigns by firms like Jeff Ubben’s ValueAct.

Larry Fink slowly becomes part of climate solution

14 Jan 2020

The BlackRock boss says the giant asset manager will dump thermal coal-focused investments, and vote against directors who aren’t doing enough on climate change. With most of its $7 trln assets tracking indexes, the firm can only go so far. But Fink’s tone suggests a step change.

UBS goes for growth with wealth management rejig

7 Jan 2020

Fresh from hiring rival executive Iqbal Khan, the bank which oversees $2.5 trln is axing unnecessary layers to serve rich clients better and faster. Only 2% of the unit’s jobs will go, though. UBS needs to boost lending to get its cost structure into line with leaner competitors.

Sustainable investing will wind up in the dock

31 Dec 2019

Around $31 trln of assets under management now include some kind of environmental, social or governance factor. But there’s widespread confusion over definitions. That leaves the market open to egregious mis-selling and fraud. A scandal is likely sooner rather than later.

Wealth managers will inflate superprime bubble

30 Dec 2019

Over a decade ago loans to subprime homebuyers blew up the financial system. Now UBS and others are cranking up credit to the uber rich. Lending against unlisted stocks or art collections brings risk. It’s still safer than helping the wealthy launder money or dodge taxes.

ESG rating sellers unite from a position of fear

5 Dec 2019

S&P Global and Moody’s have recently bought suppliers of environmental, social and governance data. That highlights ESG’s increasing importance. But the dealmaking also reflects rating providers’ need to tool up and improve often flawed metrics before someone eats their lunch.

UK property investors pay for watchdog blind spot

5 Dec 2019

The Financial Conduct Authority has passed up chances to ban real-estate funds that promise daily liquidity. Now investors are stuck in a $3.2 bln M&G vehicle that has suspended dealing. Their ire should be aimed at FCA boss Andrew Bailey for tolerating such illogical products.