The poor performance of the markets in the period under review are the reason that Spanish pension funds have seen a loss of 2.63% in the twelve-month period to the end of November, according to the Inverco assocation of asset management firms. The heaviest losses were logically enough for diversified categories investing primarily in equities (-5.29%) and equities (-7.17%). However, funds specialised in short-term bonds are the only category to post a positive result, with returns of 0.52%. Inverco points out, however, that over 21 years, average annual returns come to 4.60%, and over 20 years, they are 4.14%. As of the end of November, the 1,312 funds covered by the strategy had assets of EUR48.7bn, in 8.28 million accounts.

Credit Suisse will be reducing the amount it gives out to employees in bonuses, and will merge two of its divisions in order to cut costs, according to the Sunday newspaper Der Sonntag. Bonuses reached a total of CHF5.05bn (EUR4.2bn) in 2010. The bank will now allocate only CHF3bn for bonus payments, the newspaper states. Citing an internal memo, the newspaper also reports that Credit Suisse will bring together its bond payment and transaction operations, as part of a previously-announced cost reduction measure.

The Liechtensteinische Landesbank (LLB) on 16 December announced in a statement that Dieter Zürcher, a board member at LLB Switzerland, will be retiring from the firm in February 2012. He will be replaced by Marc Parmentier, Chief Operating Officer, who has been appointed to the board from 1 January 2012. Lucas Bruggeman, currently director of Institutional Banking activities, will also become director of Private Banking activities from 1 January 2012. LLB has also announced that its Geneva office commenced operations as planned in early autumn. As of 30 June 2011. assets under management by the LLB group totalled CHF48.7bn.

Private Banking activities in Switzerland have been put to the test in the past few years due to stricter regulations and more demanding clients. In this much more competitive environment, margins have been eroded, according to a study entitled “International Banking Study 2011,” which has recently been published by the banking and finance institute at the University of Zurich. According to the study, which is based on data from 209 firms in nine countries, including Switzerland, France, Germany, the United Kingdom, and the United States, average gross margins have fallen from 75 basis points (bp) in 2007 to 61 bp in 2010. A decline in the number of offshore clients who are less sensitive to the price factor has also contributed. The average cost/income ratio for Swiss banks has deteriorated by 17 percentage points between 2007 and 2010, to 77%, the lowest level of the nine countries included in the study. Pressure on banking confidentiality led to large amounts of capital being withdrawn in 2009, possibly as much as 5% to 10% of assets under management. But the trend turned around in 2010, due to the falling euro and the European debt crisis. Due to pressure from international tax authorities, the proportion of assets managed in a discretionary manner has fallen from 27% in 2005 to 23% in 2005, with a much stronger impact on smaller establishments, where discretionary assets have fallen to 25% last year, from 31% in 2005. The study also finds that small is not necessarily beautiful. On average, the productivity of banks which manage less than CHF10bn is lower than that of larger establishments. Earnings are much lower per employee, while costs are only slightly lower. But size is not the only criterion, as some of the smallest banks studied were highly competitive despite that, the study finds. They can be even more competitive, due to their strong potential for outsourcing. 56% of small banks operate their own IT platform, without relying on third-party services, the authors find. The 40 largest Swiss banks in terms of asset had CHF3.9trn in assets as of the end of 2010, while total assets under management by the 43 smaller establishments came to CHF130bn, slightly over 3% of the total. These figures highlight the fragmentation of the Swiss private banking sector, where the cumulative market share of UBS and Credit Suisse adds up to 56%.

As part of an effort to develop the management at the BNP Paribas group, announced by Jean-Laurent Bonnafé on 1 December, Vincent Lecomte and Sofia Merlo have been appointed as co-heads of the Wealth Management profession, BNP Paribas announced in a statement on 16 December. The two heads will report to Jacques d’Estais, deputy CEO of the BNP Paribas group and head of the Investment Solutions (IS) unit, BNP Paribas Personal Finance, and International Retail Banking, and will report functionally to François Villeroy de Galhau, deputy CEO of the BNP Paribas group and head of domestic markets. Sofia Merlo, who began her career at Paribas in September 1985, had been head of sales for private banking in France from January 2009 until her appointment in January 2010 as director of private banking in France. In her new role, Merlo will continue to direct private banking in France. Lecomte, who joined Paribas in 1992, had been Chief Operating Officer (COO) at BNP Paribas Wealth Management since September 2010.

Only 20% of Italian open-ended mutual funds outperformed their benchmark in 2010, a study by Mediobanca cited by Il Sole – 24 Ore has found. The total performance of funds was 1.2 percentage points below the benchmark on average. No fund category stood out, but the worst one was balanced funds, which did 1.9 points less well than the index, whereas last year the difference had been 0.4 points. Bond funds underperformed by 0.8 points, and money markets by 0.9 points. Equity funds lag 1.4 percentage points behind their benchmarks. Funds have underperformed every year for the past decade, except in 2009, when they outperformed the indices by 0.3 points, the Italian newspaper notes.

As of the end of June 2011, Spanish households held a total of EUR122.96bn in shares in collective management institutions (funds and Sicavs), compared with EUR126.53bn as of the end of March. By comparison, assets totalled EUR214.12bn as of the end of 2006, according to figures from Inverco, the Spanish association of asset management firms, on the basis of data from the Bank of Spain. In addition, allocation to funds and Sicavs represented 6.9% of the financial savings of households as of the end of first half (out of a total of EUR1.794trn), compared with 7.1% as of the end of December, and 8.4% as of the end of 2009. It was over 10% until 2007 (10.7%), and peaked at 13.7% in 2000. Investments in funds and Sicavs this year were at their lowest level since Inverco statistics began in 1995, when they were 10.1%. At that time, they totalled EUR64.77bn.

The CNMV has approved the acquisition of a 55% stake in the brokerage firm Interdín Gestión by Banca Privada de Aandorra (BPA), Funds People reports. The remaining 45% will continue to be controlled by Bankia, the management, and individuals associated with them. The 55% stake was sold to BPA by two savings banks, Caixa Penedés and Caja Burgos.

The board of directors at Generali has approved a move to combine the real estate and infrastructure services and investment management in a single Italian-registered entity, Generali Real Estate, the insurance group announced in a statement on 16 December. The firm, which will be led by Generali’s CFO, Raffaele Agrusti, will be operational from 1 July 2012. It will have assets under management of about EUR28bn, owned by Generali or its clients. The seven properties in its real estate funds are valued at EUR4.5bn. The firm’s objective by 2016 is to reach EUR36bn in assets under management, which represents an annual growth rate of about 6%. Generali Real Estate, present in eleven countries including Italy, France, Germany and countries of eastern Europe, has 600 employees.

Banca Generali, a financial product distribution firm 64.73% owned by the insurer Generali, will be absorbing BG SGR, its wholly-owned asset management affiliate. The operation was approved by the boards of directors of the two entities on 14 December. The merger comes as part of a reorganisation of asset management activities at Banca Generali. With this in mind, last September, BG SGR transferred its Italian-registered funds to Generali Investments Italy SGR. The funds had assets as of 30 September of EUR389m. The remaining EUR2.1bn in assets, corresponding to individual portfolios, will be integrated into Banca Generali. The activity will be housed in a specially-created new division. Banca Generali also has another asset management firm, Generali Fund Management, in which it controls 51%, while the remainder is in the hands of Assicurazioni Generali; the firm manages Sicavs for the group.

Deutsche Bank has selected one of the strategies from the hedge fund manager J E Moody & Company (JEM, USD170m) for its dbselect platform (USD5bn in 150 hedge funds with daily liquidity), Investment Europe reports. The product chosen is the Commodity Relative Value Program, which invests in commodities and makes an effort not to have commodities bets or correlations with Commodity Trading Advisers (CTA), the major asset classes, or hedge funds. The JEM program aims to be non-directional; the portfolio is invested in commodity futures in energy, metals, grains, meats, and soft commodities via a relative value spread trading strategy.

The largest bond fund in the world, the Pimco Total Return fund, managed by Bill Gross, saw further heavy net outflows in November of USD500m, bringing total net redemptions in the past twelve months to USD17bn, Investment Europe reports. In the 12 months under review, US bond funds attracted USD105.8bn in net inflows. The performance of the Pimco Total Return fund since the beginning of 2011 totalled 3.46%, while the average for the industry was 5.87%, putting Bill Gross’ fund in 163rd place out of 181 products. Assets in the Pimco Total Return fund as of 30 November still totalled USD241bn.

The FRR has launched a request for proposals to select new managers for actively managed mandates implementing and following ESG criteria and thematics. The purpose of this process is to renew the «European Equities SRI» mandates awarded in 2006 which expired this year. For this contract, the public procurement procedure being employed is that of a limited request for proposals comprising 2 lots: 1. Thematic mutual fund mandate(s) The managers shall select and manage the fund allocation based on ESG thematics framed by the FRR. 2. Europe Equities active management mandate(s), new sustainable growth The managers must invest in small and medium capitalisation companies established in Europe and that have implemented environmental, social and governance («ESG») policies or have the intention of doing so. All interested management companies must reply to the FRR by 23rd January 2012, 12.00 (Paris time) in accordance with the consultation procedure regulations. All documents relating to this request for proposals are available on the dedicated platform http://www.achatpublic.com/accueil/frr/medias/index.php via the FRR’s website www.fondsdereserve.fr

The “sleeping beauty” SPGP has resolved to awake from its slumbers at last. After recruiting a CEO, the asset management firm has gone after the IFA market, but without losing its personality, its chairman and CEO insists: no wealth management funds, no emerging market funds, or other mutual funds that might be popular with professional clients, but rather pure funds with marked biases, such as funds investing in defensive equities, or funds composed of traditional or convertible bonds.

The Chinese regulator on Friday evening announced that Chinese renminbi held abroad may now be used to buy shares in China, the Financial Times reports. The local media are also reporting that the government is preparing to increase the number of quotas allowing foreign institutions to invest in China.

The Financial Services Authority (FSA) has banned and fined Jaspreet Singh Ahuja, a former client adviser at UBS AG, GBP150,000 for failing to act with integrity and for not being a fit and proper person. He is prohibited from performing any function in relation to any regulated activity in the financial services industry.Jaspreet Singh Ahuja was a client adviser within UBS’s international wealth management business in London. Between 1 January 2006 and 30 January 2008 he used a pre-existing investment structure to enable an Indian resident customer (via an investment fund incorporated in Mauritius, the fund) to breach Indian law in clear contravention of UBS guidelines. Ultimately, the customer invested over USD250 million in the Fund.Under Indian law, an Indian investor (whether resident or non-resident in India) is not permitted to invest in Indian securities through a vehicle known as a “Foreign Institutional Investor” (FII) except in particular circumstances (which are not relevant here). Such vehicles are designed so that non-Indian investors may make investments in Indian securities.Jaspreet Singh Ahuja then wrongfully took steps to conceal the true nature of the customer’s investment, mainly by the deliberate and repeated provision of false and/or misleading information to the UBS Legal and Compliance department and other parts of UBS.He also assisted in making unauthorised redemption payments out of the Fund knowing, among other things, that the redemptions were not properly authorised by the customer and breached UBS internal compliance rules.In November 2009 the FSA fined UBS GBP8million for systems and controls failures in relation to this case. UBS has since repaid the affected customers in excess of USD42 million by way of redress.

Paul McLaughlin, who has spent 11 years at BNY Mellon in Dublin, most recently as head of alternative investment servicing fund of funds and private equity for EMEA, has been recruited as head of operations in the Alternative Investment Solutions team at State Street Corp in Guernsey. His area of expertise will remain Europe, the Middle East and Africa (EMEA); he will focus on services to private equity and real estate funds. McLaughlin will report to Phil McGowan, senior managing director of services for private equity, real estate and businesses in the EMEA region.

The British asset management firm Octopus, whose CIO and head of multi-management, Lothar Mentel, has recently left the firm (Newsmangers of 16 December), is looking to recruit ten managers, Money Marketing reports. The managing director of Octopus, Guy Miles, says the move is intended to strengthen teams in all management activities at the firm, not only in multi-management, which Mentel had a large hand in developing.

Skandia Investment Group has lost its new CEO, Phil Wagstaff, who has gone to Henderson, only two weeks after starting his job, Financial News reports. The former head of distribution from Gartmore will serve in a similar role at Henderson.

Northill Capital has acquired a majority stake in the asset management firm Wellfield Partners, and pledged to provide it with seed capital fo USD30m for at least three years. Wellfield uses a trend-following strategy in the areas of currencies, financial sector futures, and commodities. Wellfield, founded in 2009, is planning to manage a new fund to be created with seed capital from Northill, to be launched in January 2012, which will use a systemic diversified strategy replicating the strategy already in use by Wellfield since June. John Little, founder of Northill in 2010, will join the partnership committee at Wellfield. Northill is a part of the family office Kedge Capital, which manages the wealth of the Bertarelli family, among others.

Les autorités chinoises vont multiplier le nombre d’investisseurs étrangers autorisés à investir sur les marchés actions et obligations domestiques, rapportait vendredi le magazine Caixin sur son site internet, en citant une source proche de la Commission chinoise de régulation des titres.

Le chinois Citic Securities, qui devait prendre 19,9% des courtiers du Crédit Agricole avant le 31 décembre, ne pourra pas respecter l’échéance, selon un communiqué diffusé à Hong Kong. Le processus d’approbation réglementaire «sera prolongé à début 2012», explique Citic.

Philippe Troesch, directeur général d’Aberdeen AM France

Un rapport parlementaire publié aujourd’hui outre-Manche prône des évolutions du projet de loi sur les services financiers. Ces recommandations passent par un renforcement du rôle du Chancelier de l’Echiquier et par un changement de gouvernance au sein de la Banque d’Angleterre. Un comité pourrait être chargé de «maximiser l’influence» du pays.

Un renforcement du rôle du Chancelier de l’Echiquier et une modernisation de la BoE figurent parmi les principales recommandations du rapport

Le règlement Emir, dont la négociation arrive à terme, s’annonce comme un test de la nouvelle donne créée par le sommet européen du 9 décembre

Les exceptions à la transparence pré-négociation seraient encore trop nombreuses et les nouvelles plates-formes OTF trop accommodantes

Le statut de valeur refuge du métal précieux est remis en question par la chute vertigineuse des cours de la semaine dernière

La banque et les superviseurs communiquent sur le périmètre groupe. La structure cotée pourrait nécessiter de nouvelles garanties des caisses

Nicolas Forest, responsable de la stratégie taux de Dexia AM