With strong Australian connections at the top of its Asia- Pacific arm, blueblood New Yorkbased manager Neuberger Berman is looking to re-establish itself in this market after a tumultuous few years. The firm regained its independence last year in an assisted management buyout, after five years of ownership by the now-defunct Lehman Brothers. Incredibly, more than 90 per cent of staff remained with the firm through the Lehman troubles and bankruptcy, and after the buyout was completed last May. In Asia-Pacific, which has been marked as a strong growth region, Tony Edwards was appointed chief executive last December and recruited Christopher Gunns as consultant relationships manager in January.
Artisan looks to offer its talent pool to Australia
Artisan Partners, a US-based diversified equity strategy manager, is looking to have an Australian presence which will concentrate on marketing the firm’s global and emerging markets capabilities. The firm, established in Milwaukee in the mid-1990s, now has five investment teams and attempts to differentiate itself by providing the best possible environment for “talent”. The investment professionals are in Milwaukee, San Francisco, Atlanta, New York and Wilmington. The firm, which manages about US$47 billion, also has a research office in Singapore and is establishing a London office.
Lawyers warn trustees on governance
Trustees must be prepared for more legislation covering their responsibilities and start raising their educational qualifications now, according to experts from one of Australia’s leading law firms. With the possibility that APRA may be given prudential standards-making power, trustees must be prepared for the Cooper review imposing a listed-company standard of governance on super trustees’ boards, say Michael Chaaya and Christine Maher, partners in the financial services group at Corrs Chambers Westgarth. Trustee duties arise from many sources such as legislation, regulatory bodies and common law, Chaaya and Maher say, and there is considerable overlap.
Lessons can be learned from Madoff, the ‘Herod’ of investment
Police say, too many times, that criminals target people they know well. In many of these cases, crimes are committed through an exploitation of trust. Among investors, the obscene fraud committed by Bernie Madoff was the headline betrayal of trust during the financial crisis. Roger Urwin, global head of investment content at Towers Watson, adds some black humour to convey the magnitude of the US$50 billion graft: “Madoff is to investment what Herod was to childcare,” he told the annual Fund Executives Association Ltd [FEAL] Forum in Melbourne last month. He says the unearthing of Madoff ’s swindle made investors reassess their relationships with managers, and further undermined the financial industry as its credibility was under attack. “After an incident like that, you have a different industry.
Medicare clearing house is ‘ugly plumbing accident’ waiting to happen
The Medicare clearing house is an accident waiting to happen, according to superannuation e-commerce expert Peter Philip. “Technology is a bit like plumbing – it’s all pretty dull until it goes wrong, but you really want qualified plumbers doing the work or the result could be pretty ugly,” says Philip, chief executive of SuperChoice, one of Australia’s largest super clearing houses. “Just like plumbing it’s important to have experts designing the system – you have to have the right size of pipes and the right connections to make sure everything works smoothly,” he observes. “When things aren’t connected properly it’s easy for the system to back-up end up with a big, expensive and smelly mess.”
CalPERS considers new asset class classification
CalPERS is considering doing away with traditional asset class classifications in favour of classifying assets according to fundamental characteristics in a bid to provide a better understanding of portfolio risks and performance drivers and so move to a more effective portfolio construction and risk management framework. In response to analysis of the CalPERS portfolio, which found that the big Californian public sector fund did not have a meaningful-enough exposure to assets that could have been a hedge in times of financial crisis and provide adequate liquidity to the fund, the staff and the board’s consultants – Wilshire and PCA – have developed an alternative classification of assets based on underlying fundamental characteristics.
MetLife to defend 700,000 customers
MetLife will be fighting a group insurance war on two fronts in this quarter as both First State Super and Statewide put out their group insurance arrangments to tender. Michael Dwyer, First State’s CEO, says the tender documents are being drawn up to ensure “the best insurance possible” for members, a complex proposition given the insurer must deal with occupations as varied as policing, teaching and office administration.
Anxious wait for Wilshire fund-of-fund investors
Investors in Wilshire Private Markets’ Australian and international private equity funds-of-funds are waiting for the manager to call an investor meeting, at which the ongoing management of the funds will be decided following the trigger of key-person provisions by the resignations of most senior staff. Global chief investment officer Jeffrey Ennis, and senior managing directors Ovidio Iglesias and Dan Allen, ran the business until last June when parent company Wilshire Associates installed Kevin Nee as president of the private equity advisor and fund-of-funds manager.
AMP Capital’s new division will ask investors what they want
Through its new multi-asset group (MAG), AMP Capital Investors aims to distinguish itself from other big multi-managers by tapping into its asset allocation and manufacturing capabilities to build customised products in consultation with institutional clients – rather than promote existing investment strategies. David Kiddie, director of MAG, will have access to the $96 billion manager’s primary manufacturing and strategy capabilities: the strategy and research team, led by Shane Oliver, head of investment strategy and chief economist; the multi-manager Future Directions Funds (FDF) business under director Sean Henaghan; and the funds and structured team, led by Gerald Naughton.
You’re there for members, not for money: JANA’s Coombe
John Coombe, one of the most prominent gatekeepers in industry superannuation, has slammed professional super fund trustees for being more responsive to their paycheques than the interests of the members they were appointed to serve. Speaking in panel session at the 2010 Conference of Major Super Funds (CMSF) last month, the JANA Investment Advisors executive director declared: “I can’t stand professional trustees, they know nothing about the memberships of all the funds they sit on, they couldn’t give a stuff unless you’re writing out a cheque for them.”
Industry funds: Macquarie wants to be your lifetime partner
Macquarie Longevity Solutions has bet against the Henry Review recommending the Government become a lifetime annuity provider, launching a “Lifetime Income Guarantee” product combining a lifecycle asset allocation strategy with a protected capital base accessible at any time, which it claims is more attractive to consumers than traditional annuities, and is useable by any platform or industry super fund.
Excellent advice 'crucial' to keep members
Excellent financial advice from super funds will be the key differentiator in serving members post-retirement, according to two of Australia’s largest funds.
