Hermes BPK Partners, the alternative management advising boutique from Hermes, on 5 September announced plans to contribute seed capital and to assist candidates to create activities in the hedge fund sector, once the climate appears to have improved for start-ups. The specialised unit of Hermes will aim to identify and provide strategic and financial assistance to new players in the industry via an established platform, in partnership with Northern Lights Capital Group. Assets under management at Hermes BPK Partners as of 30 June totalled USD1.6bn.

M&G on 6 September announced the appointment of Adrien Barbanchon as co-head of distribution in its Paris team. He joins the team dedicated to intermediated sales (platforms, IFAs, etc), which consists of Benjamin de Frouville and Agathe Proust. Before joining M&G Investments, Barbanchon, 30, spent four years in the sales and distribution team at Edmond de Rothschild Asset Management. He has also served in sales roles at Schroders and ACI-Financement.

Carlos Aparicio Belmonte, who is responsible for trading and account management for the UK and Spain at CMC Markets in London, is joining the sales team of Massachusetts Financial Services (MFS) as senior salesperson for Spain and Portugal, Funds People reports. He will report to Juan Martín, director of sales for two countries, and since 2005, director of the Madrid branch. All MFS funds have a sales license for Spain from the CNMV.

As of 5 September, Ossiam, the new ETF boutique from Natixis Global Asset Management, already had nearly EUR186m in assets, despite the current market turbulence. Of this total, about EUR110m have gone to minimum variance (“minvar”) products, which aim to minimise risks by considerably reducing volatility, while the remainder went to funds which replicate equal-weight indices which aim to even out sectoral exposures and to reduce the predominance of large caps which characterises indices based on market cap.At a presentation at Euronext, Isabelle Bourcier, head of business development, on Tuesday evening told Newsmanagers that other ETFs are now in preparation or in a license application phase. These include both minvar funds based on variants of indices in demand by clients, and funds based on equal-weight indices for other geographical regions. Ossiam is also planning to create funds on smart indices for the world of bonds, with the launch of one or more products late this year or early in 2012.

Groupama Asset Management has announced a strategic partnership with DPA Invest, a small French asset manager specialised in dynamic asset allocation management. The affiliate of the French insurer will take over management of the fund from the boutique, DPA Gestion Privée, which has only EUR10m in assets under management. An application for this change has been submitted to the French financial market regulator, the Autorité des marchés financiers (AMF). The product will continue to be managed by DPA Invest, under a management outsourcing contract, but it will be integrated into the product range from Groupama AM, and will now become known as Groupama Risque Premium, pending approval from the regulator. The four members of the small company, including Thierry Pujol and Olivier Davanne, president and CEO, respectively, will join local teams at Groupama AM.The partnership will not involve any acquisition by Groupama AM of a stake in the capital of DPA Invest, which is 100% owned by its management. The firm will remain autonomous and independent, though nothing has been ruled out in the near or more distant future, Jean-Marie Catala, head of business development at Groupama AM, tells Newsmanagers. “Time will tell whether this partnership will lead us further,” he says.Meanwhile, although it is not an acquisition, the partnership looks like one, as DPA Invest will work exclusively with Groupama AM. Its advising activities, which accounted for most of its earnings, have been abandoned. In addition, though there has been no talk of absolute necessity, both parties have admitted that the small French company needed a partner in order to develop commercially.The move marks the first agreement of its kind in asset management for Groupama AM, but it may not be the last. “With EUR90bn in assets, we can’t be everywhere,” explains Catala. And among the other areas in which Groupama AM would like to develop are emerging markets, in bonds as well as equities, Euorpean high yield, the theme of inflation, and liability-driven investment (LDI).

Hedge fund managers are now extremely pessimistic about US equities. According to the most recent survey from BarclayHedge/Trim Tabs Investment Research, pessimistic outlooks on the part of hedge fund managers about the evolution of the S&P 500 rose to 42% in the month of August, compared with 27% in July. Only 27% of managers now predict that the market will rise, compared with 43% one month earlier. This is a highly marked evolution month on month, which is probably related to two factors: on the one hand, the S&P 500 fell by 16.8% between 22 July and 8 August, and on the other hand, the Federal Reserve announced on 9 August that it will be maintaining its low interest rate policy until mid-2013, due to less encouraging economic outlooks. In terms of the evolution of the US dollar, managers have become slightly more pessimistic in August, with an increase in pessimistic opinions to 34% in August, from 30% in July, while only 24% of managers have an optimistic outlook, compared with 33% previously. Managers also remain pessimistic about long-term interest rates, with 32% pessimistic compared with 15% optimistic.

The OFI group on 6 September announced the creation of an affiliate dedicated to independent financial advisers (IFAs), OFI Premium, which will offer wealth management professionals the full range of products and services from the group, via dedicated and personalised solutions. Annie Riaud, director of development at OFI Premium, says that “IFAs have become undeniably powerful actors in savings in France. That’s the reason we wanted to create a structure dedicated to them, which offers products, advice and personalised solutions. IFAs will receive an adapted and reactive service.” The range from OFI Premium will rely on all the expertise of the group: collective management, asset allcoation advising, mandated management, special products, and associated services. In order to assist IFAs in their considerations and investment choices, IFO Premium makes analysis and research available, via specific tools: newsletters, whose titles translate as “Between Us,” “Product Info,” and “Flash VL Weekly,” as well as training, events in cooperation with platforms, iPhone and iPad apps, and a new website. OFI Premium has a team of 10 people. The range of offerings from OFI Premium will be unveiled at the Patrimonia convention at the end of September in Lyon.

Chuck Baldiswieler, president and CO of TCW Funds, and director of MetWestFunds (Société Générale and Amundi), has announced that the MetWest Total Return Bond Fund topped USD15bn in assets in August (and has thus more than doubled in size since the acquisition of MetWest by TCW two years ago), and that the TCW Emerging Markets Income Fund has nearly reached USD3bn in assets under management, Mutual Fund Wire reports.Overall, the two asset managers have posted net subscriptions since the beginning of the year of USD4.6bn, which will allow them to recruit for the sales team.

The US private equity firm Carlyle on 6 September resolved to submit an application to the SEC, as part of plans that have been under consideration for several months, to offer its shares on the New York Stock Exchange, where it would join its major rivals KKR and Blackstone, Les Echos reports. Carlyle is planning to issue USD1bn in shares, even though several planned IPOs on NYSE totalling USD3.4bn have had to be revised in the past three months, Bloomberg reports.

The banking group Bank of America, which is facing major difficulties, on 6 September announced a reshuffle of its management team, with the appointment of two new chief operations officers, David Darnell and Tom Montag, both internal promotions. Meanwhile, the current head of the banking services to individual and small business clients division, Joe Price, and the head of the wealth management and investment divisions, Sallie Krawcheck, a Wall Street star, will be “leaving the firm” the establishment says in a statement. The bank says the most aims to “align the operational units of the business with its three major groups of clients: individuals, businesses, and institutional investors.” Darnell becomes head of the divisions in charge of individual clients, while Montag will oversee the divisions in charge of medium to large businesses and institutional investors. The move marks “an important step in the transformation” of the business, says chairman and CEO Brian Moynihan, cited in a statement. “Removing a level in operations management” and “simplifying the organisation” will allow for “a significant reduction in costs,” among other measures, Bank of America states.

Marco Strimer will take over as chief operations officer at Banque Sarasin & Cie SA from 1 November, the firm announced in a statement on 6 September. Strimer had previously been CEO of SIX x-clear SA. Strimer succeeds Julius Zuercher, who will be retiring in late 2011 after 44 years of activity in the banking sector, including twelve years at Banque Sarasin.

Finance and utilities were the most sought-after sectors for sovereign wealth funds (SWFs) in first half. According to statistics from the SWF Institute, sovereign funds invested USD7.09bn in the financial sector between January and June 2011, and USD3.13bn in utilities.The countries which have attracted the most investment from sovereign funds since the beginning of the year were Spain, with a total of USD8.41bn, followed by France (USD6.76bn), China (USD6.61bn), and the United Kingdom (Usd6.25bn). The United States, Brazil and Canada were also popular destinations for sovereign funds, but for smaller investments.Sovereign wealth funds have also increased their investments in real estate.

A group of institutional investors representing about USD1.3trn in assets on 6 September announced the launch of Principles for Responsible Investment for agriculture, entitled “Farmland Principles,” with the objective of improving sustainable development, transparency and accountability aspects of investments in agriculture. The principles have been developed and adopted by several major institutions, including the Swedish fund AP2, the Netherlands’ ABP and APG, the Danish ATP, the British BT Pension Scheme and Hermes EOS, the Dutch PGGM, and the American TIAA-CREF, all of which are signatories to the United Nations Principles for Responsible Investment (UN-PRI).

Gareth Lewis has been recruited as head of investment management at Bestinvest, Fundweb reports. Lewis had been head of investment management for the United Kingdom at UBS. Meanwhile, Graham Frost on 6 September signed his “Market Update” as CIO of Bestinvest.

The British private equity group 3i has been punished by the market’s disaffection with all financial sector shares, but is doing worse than its counterparts, Les Echos reports. Some analysts estimate that the drop in its share price is exaggerated, however.

EFG Asset Management (EFGAM) UK officially opened for business on 6 September. It is a new affiliate of EFG International, whose CIO, Moz Afzal, based in London, is also CEO, Fundweb reports.

HSBC Global Asset Management is launching the HSBC Global Investment Funds-China Consumer Opportunities, which it describes as the first international equity fund in Hong Kong to invest both in local and international companies that profit from growth in consumer spending in China, Asian Investor reports. According to estimates by HSBC, consumer spending in China is expected to exceed US consumer spending by 2020, when the Chinese middle class will have expanded to include 700 people, up from 400 million currently. The fund will invest in mid and large caps in a wide range of sectors, including automotive, electronics, fashion, general retail, and jewellery. 50% to 70% of the assets in the portfolio will be invested in luxury brands, with a 30% to 50% proportion invested in less high-end local and international brands.

Janus Capital International Limited, the international arm of Janus Capital Group Inc., has launched the Janus Asia Fund, part of its Dublin-domiciled Janus Capital Funds plc range. The Fund’s investment objective is long-term growth of capital by investing at least 80% of its assets in emerging and developed markets in Asia – with the exception of Japan and uses the MSCI All Country Asia ex-Japan Index as its benchmark. It will consist of between 60-100 holdings and will have a tracking error range to benchmark of between 3-7%. The fund which was launched on 31 August, 2011 will be managed by Singapore-based Janus portfolio manager, Hiroshi Yoh.

The Securities and Exchange Commission is seeking to determine if ETFs amplified the volatility on the markets in August, according to the Wall Street Journal, citing sources familiar with the matter. It is concentrating on leveraged ETFs, which amplify investors’ bets, often through the use of derivatives. ETFs now generate 35% to 40% of market volumes, according to Morningstar. In the first two weeks of August, leveraged ETFs represented about 13% of total ETF volumes.

The cost of a Euro break-up would be extremely high, and far higher than the price of bailing it out, a recent research from UBS Investment Research shows.The cost of a weak country leaving the Euro is significant. Consequences include sovereign default, corporate default, collapse of the banking system and collapse of international trade. UBS estimate that a weak Euro country leaving the Euro would incur a cost of around EUR9,500 to EUR11,500 per person in the exiting country during the first year.That cost would then probably amount to EUR3,000 to EUR4,000 per person per year over subsequent years. That equates to a range of 40% to 50% of GDP in the first year. If Germany were to leave, UBS believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. In comparison, the cost of bailing out Greece, Ireland and Portugal entirely in the wake of the default of those countries would be a little over EUR1,000 per person, in a single hit.

The manager of the European Growth fund (GBP641m in assets) at Royal London Asset Management (RLAM), Kevin Lilley, will be joining Old Mutual Asset Management (OMAM). Lilley will begin in his new role next month. He will be manager of the European Equity fund, whose assets under management total GBP71m. Lilley, who practices a conviction-based management, will also assist the group to develop its range of equity funds. The European Growth fund, which Lilley has managed since July 2001, has earned annualised returns of 5% over ten years. In the same period, the European Equity fund, launched in 1998, earned annualised returns of 4.4%.

The Luxembourg affiliate of the German private bank Hauck & Aufhäuser (H&A) on 6 September announced the launch of the fund of wealth-management fund Diversified Strategic Asset Allocation Funds Saphir, a multi-strategy and multi-manager product whose currency of reference is the euro. The advisor for the product is the independent wealth manager performance IMC, based in Mannheim.The performance objective for the fund, which aims for a 60/40 balance between equities and bonds, is 4%. The portfolio may invest in equity and bond funds (corporate bonds, high yield) as well as UCITS-compliant absolute return funds and hedge funds.CharacteristicsName: Diversified Strategic Asset Allocation Funds SaphirISIN code: LU0635707374Front-end fee: maximum 4%Management commission: maximum 1.25%Depository banking commission: 0.08% maximumPerformance commission: 20% of performance exceeding 4%, with high watermark

After nearly a year in soft closing, subscriptions to the European High Yield Bond Fund, a sub-fund of the Luxembourg Sicav Nordea 1, were reopened on 5 September. Officially, the fund (LU0141799097), with EUR1.15bn in assets, is now no longer constrained by its size, due to the enlargement of the European high yield bond market due to a record number of issues. In practice, it also appears that assets have somewhat declined, which leaves more room for the fund to accept new subscriptions.Nordea observes that concerns about the solvency of some Western countries, and anticipation of a slowdown in global growth have provoked a sharp increase in spreads on the high yield bond market. The external management team, led by Henrik Østergaard, points out that in August, the Option Adjusted Spread (OAS) widened by 237 basis points, to 852 points. This spread level theoretically makes it possible to offset a default rate of over 10%, though the default rate is currently only 2%.

Handelsblatt reports that Goldman Sachs has submitted an application to the SEC for its first US-registered ETF fund. It would be an equity product, which would replicate an index, weighted according to the book value and ROE or dividends, not to market cap. Goldman Sachs is also planning bond and wealth-management type ETFs.

Compared with the most recent official statistics from the BVI association of asset managers, for June, German equity funds saw a decline in August of more than 20% in their assets. Assets under management have also declined for other asset classes. On the basis of average commissions, experts at the Kommalpha agency in Hanover estimate that fund “producers” have seen an arithmetic loss in their revenues of EUR500m in annualised terms, due to the turbulence on the financial markets. This loss will aggravate pressure on asset managers which in the recent years have undergone a noticeable erosion of their margins and a deterioration in their profit situation.In first half, total assets in funds in Germany (including institutional funds, or Spezialfonds), increased by EUR5.01bn, to a total of EUR1.52753trn. Assets under management in Spezialfonds increased by EUR20.18bn in six months, to EUR832.66bn. Overall, funds have seen net subscriptions of EUR13.33bn (but Spezialfonds have attracted EUR16.95bn), while market effects have been negative overall by EUR8.32bn (though the figure was positive by EUR3.23bn for Spezialfonds).Kommalpha also observes that professional and institutional investors are currently tending to withdraw from open-ended funds, or to partially trade these in favour of ETFs. However, retail investors are more radical in their decisions: as in the period from 2008 to 2009, many of these investors are tending to completely withdraw from funds. In the last crisis, the asset management sector lost 1.3 million retail clients.

Hermes BPK Partners, la boutique de conseil en gestion alternative de Hermes, a annoncé le 5 septembre son projet d’apporter du capital d’amorçage et d’accompagner les candidats à une activité dans le secteur des hedge funds alors que le climat semble s’améliorer pour les start-up.Le pôle spécialisé de Hermes veut identifier et fournir une aide stratégique et financière aux nouvelles «pousses» par l’intermédiaire d’une plate-forme établie en partenariat avec Northern Lights Capital Group. Les actifs sous gestion de Hermes BPK Partners s'élevaient au 30 juin dernier à 1,6 milliard de dollars.

Citant des sources proches des discussions, le quotidien avance que des responsables du gendarme américain des marchés mène actuellement une enquête auprès des gestionnaires de fonds indiciels cotés (Exchange-traded funds, ETF) pour évaluer leur impact sur la volatilité des marchés le mois dernier.

Le quotidien britannique croit savoir que l’ancien directeur général du groupe pétrolier BP, Tony Hayward, s’apprête à diriger pour environ deux milliards de dollars la première acquisition de son nouveau véhicule d’investissement, coté à Londres depuis juin dernier. La cible est Genel Energy, un groupe indépendant spécialisé dans l’exploration pétrolière en Irak.

Parmi les amendements les plus notables, la taxe sur la valeur ajoutée va être relevée d’un point de pourcentage, à 21 %

Les accords fiscaux conclus avec l’Allemagne ou le Royaume-Uni devraient accélérer ce mouvement de consolidation