Asset management

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.

Action speaks louder than words on ESG issues

28 Nov 2019

Big index funds justify holding stocks with poor environmental, social and governance profiles by pledging to engage with their bosses. New research suggests this isn’t working. While there’s merit in naming and shaming, pension funds voting with their feet is more effective.

Bacon exit offers veiled short on hedgie revival

21 Nov 2019

Louis Bacon is returning investors’ money in his firm Moore Capital. He’s the latest big hedge fund manager to step back, but the decision jars with a good year for traders who make bets on economic shifts. Bacon has his reasons, but it’s hardly a signal that recovery will last.

Lazard’s earnings clouds come with silver linings

31 Oct 2019

Operating income at Ken Jacobs’ M&A and money-management firm fell almost twice as much as Evercore last quarter. But at least Lazard, which has bagged roles on the giant Aramco IPO and merger of Fiat with Peugeot, finally trades at a higher multiple of earnings than its rival.

Hadas: Index funds set companies even more adrift

23 Oct 2019

Institutional shareholders have long treated governance as an expense. The rise of passive investors amplifies the neglect, the OECD suggests. But family or state control have problems too, and stakeholder interests are hard to balance. Boards of directors need clearer goals.

Lazard limits fallout in Paris M&A meltdown

21 Oct 2019

Top dealmaker Matthieu Pigasse, head of the Wall Street firm’s French outfit, is leaving to set up a business “beyond investment banking”. At least he’s not joining or creating a direct rival. That gives boss Ken Jacobs a chance to stave off more departures as competitors circle.

Hadas: Passive funds help, and hurt, stock markets

2 Oct 2019

More than half the dollars in U.S. equity funds now mimic indexes. The trend to thought-free investing lowers fees and may limit the supply of dumb money. But it adds to the economic irrelevance of public markets and gives poor incentives to both boards and politicians.

Gilbert exits Standard Life Aberdeen with whimper

2 Oct 2019

The former co-CEO of the $8 bln asset manager will step down as vice chairman next year. His departure removes management clutter. But with shares off over a third since 2017, the best argument for the merger he led is that without it, things would have been even worse.

Credit Suisse spy caper explodes Swiss discretion

24 Sep 2019

The Swiss bank’s former wealth management boss Iqbal Khan called police after private detectives pursued him around Zurich. Lenders have legitimate fears about rivals poaching staff. But snooping on bankers suggests paranoia, while getting caught in the act is just incompetent.

Review: Blackstone’s unapologetic buyout baron

17 Sep 2019

Steve Schwarzman’s memoir is a rollicking tale of banking’s glory days, and how he built an investing colossus. It’s also a love letter to elitism from a man who talks with Donald Trump and Xi Jinping. Capitalism is under attack, but Schwarzman leaves no doubt which side he’s on.