Asset management

Standard Life’s honey pot is a shrinking prize

10 May 2017

Even as the asset manager merges with rival Aberdeen, its flagship GARS fund is eroding. Some 2.8 bln pounds exited in the first quarter. That makes the tie-up look less sweet for Aberdeen shareholders. Fortunately, they were already getting better than might have been expected.

Money managers can’t dance to save themselves

2 May 2017

Fee pressure, passive investing and technology ought to spell big industry mergers. Yet those pressures, and the poor response to recent tie-ups, make such marriages hard. Deals to fill product and sales gaps, like Invesco’s Source bid, look like a more palatable option.

UK fund merger may tempt staff more than investors

2 May 2017

Aberdeen and Standard Life have set aside a reported 35 million pounds to retain star workers after they merge. The cost savings should be bigger and Aberdeen’s latest results support the strategic rationale for the deal. Yet market moves suggest shareholders are sceptical.

AllianceBernstein shakeup sends active sell signal

1 May 2017

The firing of CEO Peter Kraus is the latest wakeup call for Wall Street stock pickers. Diversification efforts at the AXA-controlled firm failed to offset a long decline in its once-potent equities business. The upheaval suggests other active managers also have nowhere to hide.

BlackRock’s evolution keeps fee pressures at bay

19 Apr 2017

The manager of $5.4 trln of assets boosted its top line and margins in the first quarter even as new cash flowed mostly into its low-cost ETF products. Larry Fink’s shop has the scale and capacity for reinvention – like ditching human stockpickers – to stay ahead of the curve.

Activism prods GAM in right direction

18 Apr 2017

The Swiss hedge fund group will review compensation and cap its CEO’s pay because of pressure from investor RBR. The activist’s more disruptive plans may not win backing from other investors. But it can claim credit for forcing change in an industry resistant to shakeups.

Goldman’s robo venture co-opts startup rivals

21 Mar 2017

The U.S. investment bank is the latest established player to build an automated private banking tool for clients. Standalone robo-advisory services are already struggling with lousy margins. Now, as more incumbents fight back, their best option may be to sell.

Aberdeen-StanLife offer thin gruel on two-CEO move

20 Mar 2017

The fund managers have spelled out how Chief Executives Keith Skeoch and Martin Gilbert will split the job after their planned merger. But it’s still a fudge, with too much room for discord. Judging by the share price, investors are giving the deal two thumbs down.

Viewsroom: Trump’s bad prescription for Obamacare

9 Mar 2017

The U.S. president and congressional Republicans’ rush to ditch the Affordable Care Act is spawning pox-plagued legislation. Meanwhile, Deutsche Bank tries to get its financial house in order. And State Street’s fund managers are pushing to get more women on corporate boards.

Scarcity of UK chairmen is partly man-made

9 Mar 2017

Rio Tinto’s Jan du Plessis is leaving for BT. Barclays and Standard Life’s chairs will reportedly stay put for two years, with the latter likely to replace the former. The merry-go-round shows too few people can run complex boards. Increasing the supply requires lateral thinking.

Bigger is rarely more beautiful for asset managers

8 Mar 2017

Standard Life and Aberdeen’s 11 billion pound tie-up follows a similar tie-up by Henderson and Janus. Yet increased scale cuts both ways. Growth can sap returns, and clients don’t always like to see fund managers get bigger. The market isn’t assigning much value to either merger.

Board diversity is good use of passive voice

7 Mar 2017

Women in the boardroom can improve performance, but U.S. companies have been slow to adapt. State Street, where three of 11 directors are female, is threatening proxy fights if companies don't widen their gender horizons. It's a smart way for quieter fund managers to get pushy.

Scot asset managers try marriage of inconvenience

5 Mar 2017

Merging Standard Life and Aberdeen will create an 11 billion pound fund giant able to rip out costs and fight back against competition. Leaving both chief executives in charge is an unseemly fudge, though. Hopefully the clunky governance will be temporary.

Deutsche $8.5 bln equity hike would be partial fix

4 Mar 2017

The German bank may raise funds while markets look kind. The infusion would boost creditworthiness and thus Deutsche Bank's key trading and corporate lending arms. That's fine unless investment banking falters, or Deutsche turns out to have underestimated its capital needs again.

Fund cannibalism is a chewy meal for activists

27 Feb 2017

Asset manager GAM has been urged to shake up its board by an activist fund. The Swiss group’s performance and governance make it vulnerable, but fund managers are tricky targets: the industry's fee structure is challenged, costs are high, and regulators demanding.

SoftBank’s bet on Fortress is a smart acqui-hire

15 Feb 2017

SoftBank boss Masayoshi Son is following through - in a big, unexpected way - on his investment pledge to Donald Trump. Buying Fortress for $3.3 bln won't add any tech luster to SoftBank, but the $70 bln alternative-investment firm provides a platform for acquisition-led growth.

Curing myopic CEOs requires playing long game

8 Feb 2017

A new McKinsey study finds that companies that focus too much on quarterly results badly underperform rivals with more distant horizons. It's just correlation not causality, but the research is a compelling start. Persuading investors might in time convince Corporate America.

HNA buys SkyBridge to White House

18 Jan 2017

The Chinese conglomerate is taking a stake in newly minted White House adviser Anthony Scaramucci's hedge fund. The business fit is a stretch. But the rationale of deal-hungry HNA hoping to make a friend on Trump's team as it tries to expand in the United States is hard to avoid.

BlackRock makes it hard to go with the flow

13 Jan 2017

Despite attracting $200 bln last year to grow the investment firm's tally to $5.2 trln, revenue fell. Slashing expenses and buying back stock enabled BlackRock to exceed fourth-quarter estimates. Only its scale and diversity help mitigate the costly stampede into low-cost ETFs.

Regulators try to save fund lemmings from selves

12 Jan 2017

Customers of open-ended investments rely on false promises of liquidity that tend to evaporate in market panics. The Financial Stability Board has some ideas for addressing the ensuing risks. Its ideas are sound, but would be superfluous if fund managers did their jobs.