Wealth Bulletin
24 June 2008 - By Jason Corcoran
Merrill Lynch wealth management unit is expanding its business by opening new offices in Russia and Turkey and expanding teams in Greece and other regions of emerging Europe.
Jean-Marie Deluermoz, director of emerging European markets, EMEA Wealth Management, at Merrill Lynch, said the group had given him a substantial budget to expand the business over the next five years.
Speaking in Moscow at the launch of the Capgemini Merrill Lynch 2008 Wealth Report, he told Wealth Bulletin: "We have a big recruitment budget for the region. Emerging Europe - Russia, the former Soviet Union states, Turkey and Greece - are attracting strong growth rates for wealth management."
A Moscow office to serve Russian clients offshore is expected to open in the third quarter, as is a new office in Istanbul. Merrill is also recruiting new teams for Greece and other countries, which were not disclosed.
Deluermoz, who set up Credit Suisse's representative office in Moscow in 2003, will take charge of the Russian operation from London.
He said Russian high net worth clients were starting to look beyond cash deposits and real estate investment to more sophisticated products such as hedge funds.
Deluermoz said the bank had decided not to go down the route of offering onshore banking in Moscow like its rivals UBS and Credit Suisse.
"It takes one year to get authorisation from the market regulator and another two years for a retail banking license, which you need to offer wealth management services," he added.
Showing posts with label wealth management. Show all posts
Showing posts with label wealth management. Show all posts
Thursday, 3 July 2008
Monday, 18 February 2008
New Geneva Team for Russian ultra wealthy
Wealth Briefing
February 18, 2008
Jason Corcoran in Moscow
JP Morgan Private Banking is setting up a new Geneva-based team to serve Russian ultra high-net worth clients.
Leonard Tsomik, head of JP Morgan Private Banking Russia & Eastern Europe, said he had identified a number of candidates to hire in Geneva to complement the bank's Russia team in London and 100-strong personnel already covering the county.
In an exclusive interview with WealthBriefing, he said: "We have a small team in London and we are about to establish a team in Geneva of considerable size. Russians are very active in Switzerland and some have made their homes there so it makes sense to compliment our London coverage. We have a small active pipeline of professionals worth hiring for Geneva."
JP Morgan targets Russian ultra high net worth individuals and families with investment portfolios of $30 million or more. The minimum benchmark to invest with the bank offshore is $10 million, which far exceeds the average $1.5 million portfolio of Troika Dialog's ultra high net worth clients.
"Some of our competitors will take $500,000 million or less to get market share and to reach our levels. They cast a wider net," he added.
Mr Tsomik has worked on the Russian market in private banking and private equity since 1994 although JP Morgan only entered the market recently.
"All of our clients continue to invest a predominant amount in Russia," he explained. "Some like discretionary approach or advisory approach. We can also do things other banks can't do. Our core business is asset management and we are also an investment bank to private clients."
JP Morgan's investment bank was one of the first foreign banks to open in Russia in 1973 and last year topped the league table for involvement in Russian M&A advisory work.
Mr Tsomik said the private bank would leverage off the investment bank's experience and contacts in the market.
"We work very closely with the investment bank without violating regulations, confidentiality or Chinese walls. It's key to have the introduction from the investment bank because cold calls are only so good in any market."
Mr Tsomik said the origins of Russia's wealth had transformed overwhelmingly from natural resources to relatively new consumer economy sectors such as retail, food processing and real estate over the past five years.
"The market is very young and the clients are very young and very active in their business. There are no second and third generation clients. These guys are very sophisticated and are very interested in managing their own money and only parting with a portion of it. "
February 18, 2008
Jason Corcoran in Moscow
JP Morgan Private Banking is setting up a new Geneva-based team to serve Russian ultra high-net worth clients.
Leonard Tsomik, head of JP Morgan Private Banking Russia & Eastern Europe, said he had identified a number of candidates to hire in Geneva to complement the bank's Russia team in London and 100-strong personnel already covering the county.
In an exclusive interview with WealthBriefing, he said: "We have a small team in London and we are about to establish a team in Geneva of considerable size. Russians are very active in Switzerland and some have made their homes there so it makes sense to compliment our London coverage. We have a small active pipeline of professionals worth hiring for Geneva."
JP Morgan targets Russian ultra high net worth individuals and families with investment portfolios of $30 million or more. The minimum benchmark to invest with the bank offshore is $10 million, which far exceeds the average $1.5 million portfolio of Troika Dialog's ultra high net worth clients.
"Some of our competitors will take $500,000 million or less to get market share and to reach our levels. They cast a wider net," he added.
Mr Tsomik has worked on the Russian market in private banking and private equity since 1994 although JP Morgan only entered the market recently.
"All of our clients continue to invest a predominant amount in Russia," he explained. "Some like discretionary approach or advisory approach. We can also do things other banks can't do. Our core business is asset management and we are also an investment bank to private clients."
JP Morgan's investment bank was one of the first foreign banks to open in Russia in 1973 and last year topped the league table for involvement in Russian M&A advisory work.
Mr Tsomik said the private bank would leverage off the investment bank's experience and contacts in the market.
"We work very closely with the investment bank without violating regulations, confidentiality or Chinese walls. It's key to have the introduction from the investment bank because cold calls are only so good in any market."
Mr Tsomik said the origins of Russia's wealth had transformed overwhelmingly from natural resources to relatively new consumer economy sectors such as retail, food processing and real estate over the past five years.
"The market is very young and the clients are very young and very active in their business. There are no second and third generation clients. These guys are very sophisticated and are very interested in managing their own money and only parting with a portion of it. "
Monday, 11 February 2008
Branson’s space race targets Troika clients
Financial News
Jason Corcoran in Moscow
11 February 2008
The strength of Troika Dialog Asset Management chairman Pavel Teplukhin’s client list has attracted the interest of a string of global entrepreneurs keen to do business with him, including Virgin Group chairman Sir Richard Branson.
The asset manager, the funds arm of the Russian investment bank Troika Dialog, which Teplukhin helped to establish, deals exclusively with Russia’s high net worth clients. Branson approached him at a Russian conference last month, seeking to lure them on to his Virgin Galactic space tourism programme.
Branson said: “I think we should meet and talk business. We have already signed up the first 100 passengers but Russia could be a great market for us.”
Teplukhin, one of the founders of Troika and president of asset management since 1991, can vouch for his clients’ wealth but not their love of space travel.
He said: “If you look at the Forbes rich list, I can tell you that 30% of the names are my clients. We only deal in the seriously rich. My revenues are more than the largest private bank in Monaco.”
The Russian edition of US magazine Forbes runs a special issue every year featuring Russia’s leading millionaires.
Troika’s asset management arm runs a full range of investment products, including sector funds, real estate investment trusts and hedge funds. It markets them to upper middle-class investors, whose portfolios average $25,000 (€17,063) and wealthy clients with average portfolios of $1.5m.
Overall funds under management stand at $5bn, although Teplukhin prefers to measure his business in terms of the fees it brings in. He said: “We earn higher fees than the other banks by focusing on higher margin business. We don’t count money deposits because it’s a low-margin business and we don’t do custody, which is outsourced to UBS at the cost of about three basis points.”
Teplukhin declined to say how much he charges clients, but industry sources suggested it was about three percentage points.
Teplukhin welcomed the arrival of wealth management banks UBS and Credit Suisse to Moscow, but added they would have to build brand awareness from scratch.
Both Swiss banks have set up onshore wealth management operations in Moscow in the past year to compete with Russian banks and Germany’s Deutsche Bank, which has £1bn (€1.3bn) in funds under management.
Teplukhin said investment houses were not willing to pay asset managers enough money. He said: “Talent is not that deep and juniors here with three to four years experience expect a seven-figure salary. There are one million millionaires in Russia and only 3,000 of those use private banking services."
Jason Corcoran in Moscow
11 February 2008
The strength of Troika Dialog Asset Management chairman Pavel Teplukhin’s client list has attracted the interest of a string of global entrepreneurs keen to do business with him, including Virgin Group chairman Sir Richard Branson.
The asset manager, the funds arm of the Russian investment bank Troika Dialog, which Teplukhin helped to establish, deals exclusively with Russia’s high net worth clients. Branson approached him at a Russian conference last month, seeking to lure them on to his Virgin Galactic space tourism programme.
Branson said: “I think we should meet and talk business. We have already signed up the first 100 passengers but Russia could be a great market for us.”
Teplukhin, one of the founders of Troika and president of asset management since 1991, can vouch for his clients’ wealth but not their love of space travel.
He said: “If you look at the Forbes rich list, I can tell you that 30% of the names are my clients. We only deal in the seriously rich. My revenues are more than the largest private bank in Monaco.”
The Russian edition of US magazine Forbes runs a special issue every year featuring Russia’s leading millionaires.
Troika’s asset management arm runs a full range of investment products, including sector funds, real estate investment trusts and hedge funds. It markets them to upper middle-class investors, whose portfolios average $25,000 (€17,063) and wealthy clients with average portfolios of $1.5m.
Overall funds under management stand at $5bn, although Teplukhin prefers to measure his business in terms of the fees it brings in. He said: “We earn higher fees than the other banks by focusing on higher margin business. We don’t count money deposits because it’s a low-margin business and we don’t do custody, which is outsourced to UBS at the cost of about three basis points.”
Teplukhin declined to say how much he charges clients, but industry sources suggested it was about three percentage points.
Teplukhin welcomed the arrival of wealth management banks UBS and Credit Suisse to Moscow, but added they would have to build brand awareness from scratch.
Both Swiss banks have set up onshore wealth management operations in Moscow in the past year to compete with Russian banks and Germany’s Deutsche Bank, which has £1bn (€1.3bn) in funds under management.
Teplukhin said investment houses were not willing to pay asset managers enough money. He said: “Talent is not that deep and juniors here with three to four years experience expect a seven-figure salary. There are one million millionaires in Russia and only 3,000 of those use private banking services."
Monday, 28 January 2008
Russian wealth manager head leaves Deutsche Bank
Financial News
Jason Corcoran in Moscow
28 January 2008
Claus Korner, head of Deutsche Bank’s wealth management business in Russia, has left for Icelandic banking group Glitnir.
Korner, head of Deutsche Bank’s private wealth management since 2004, has been working in Russia and eastern European private banking and asset management since 1992.
He was a pioneer at Deutsche in attracting clients worth more than $1bn and proving wealthy Russians are prepared to invest their money onshore. Private banking group UBS and Credit Suisse have followed in Deutsche’s wake and set up operations in Moscow.
Other senior Deutsche staff in Moscow have resigned in the past year as the market for top Moscow bankers has become more competitive.
Russian rainmaker Nick Jordan left for Lehman Brothers and his investment banking co-head Ilya Sherbovich is leaving soon to start a boutique.
Glitnir, which is setting up corporate finance, brokerage and asset management in Moscow, is recruiting eight sales and marketing staff to its wealth management team, in addition to its four advisers.
Erkin Nusurov, former managing director for investments at Austria’s Raiffeisen Asset Management, has also joined as chief investment officer.
Raimo Valo, head of investment management for Russia, said Glitnir’s threshold for wealth clients will be about a third of its rivals.
Glitnir last year acquired Finland’s FIM Asset Management, which has a record of investing in Russia since 1997.
The group last year launched three rouble-denominated mutual funds – FIM Russian Equities, FIM Russian Portfolio and FIM Russian Bonds – which closely match other funds that invest in Russia.
Glitnir’s large and small-cap Russian funds have more than €500m ($733.79m) under management. As the Nordic region’s third-largest broker, Glitnir manages more than €8.5bn in assets under management in 46 funds.
www.efinancialnews.com
Jason Corcoran in Moscow
28 January 2008
Claus Korner, head of Deutsche Bank’s wealth management business in Russia, has left for Icelandic banking group Glitnir.
Korner, head of Deutsche Bank’s private wealth management since 2004, has been working in Russia and eastern European private banking and asset management since 1992.
He was a pioneer at Deutsche in attracting clients worth more than $1bn and proving wealthy Russians are prepared to invest their money onshore. Private banking group UBS and Credit Suisse have followed in Deutsche’s wake and set up operations in Moscow.
Other senior Deutsche staff in Moscow have resigned in the past year as the market for top Moscow bankers has become more competitive.
Russian rainmaker Nick Jordan left for Lehman Brothers and his investment banking co-head Ilya Sherbovich is leaving soon to start a boutique.
Glitnir, which is setting up corporate finance, brokerage and asset management in Moscow, is recruiting eight sales and marketing staff to its wealth management team, in addition to its four advisers.
Erkin Nusurov, former managing director for investments at Austria’s Raiffeisen Asset Management, has also joined as chief investment officer.
Raimo Valo, head of investment management for Russia, said Glitnir’s threshold for wealth clients will be about a third of its rivals.
Glitnir last year acquired Finland’s FIM Asset Management, which has a record of investing in Russia since 1997.
The group last year launched three rouble-denominated mutual funds – FIM Russian Equities, FIM Russian Portfolio and FIM Russian Bonds – which closely match other funds that invest in Russia.
Glitnir’s large and small-cap Russian funds have more than €500m ($733.79m) under management. As the Nordic region’s third-largest broker, Glitnir manages more than €8.5bn in assets under management in 46 funds.
www.efinancialnews.com
Wednesday, 13 June 2007
Renaissance Capital Reveals Global Wealth Management Ambitions
Wealth Briefing
June 12, 2007
Jason Corcoran in Moscow
Renaissance Capital, the Russian investment bank, is planning to open offices in Dubai, Singapore and Hong Kong to service its fast growing wealth and asset management business.
Its expansion overseas is underpinned by a conviction that Russian private investors will want to diversify their portfolios and invest more abroad amid uncertainty ahead of next year's presidential election.
The move to set up operations in Asia and the Middle East follows the opening of an operation in Geneva, as revealed by WealthBriefing in April.
Stephen Jennings, the chief executive of Renaissance Capital, said the push overseas stemmed from existing Russian and CIS clients demanding access to international financial markets.
In an exclusive interview with WealthBriefing, he said: "Clients within Russia and CIS want international assets, international custodian and wealth management services. As we go into other geographies, we will sell those same products to local clients in those markets also. It's about giving really tailored wealth management products to high networth Russians, Ukrainians, Kazakhs and so forth."
Renaissance's fund arm Renaissance Investment Management is Russia's market leader with almost $4.5 billion in assets under management. Jennings said more than half of assets were accounted for by high net worth clients.
Domestically, Mr Jennings welcomed the arrival of global wealth management players but suggested their strategy might not hit the mark.
He said: "UBS and Credit Suisse are tailored towards a global business. They would say otherwise but their product is quite standardised. What we are dealing with in Russia is a completely new class of wealthy people. They are used to exceptionally high levels of service in other areas of their lives. They are not getting that highly tailored and high-end service from someone who is a generic wealth provider."
Mr Jennings argued Renaissance can provide a both high end service to its clients and the best products through white-labelling.
He added: "It's not a option for us to give people anything but Rolls-Royce service. International products are all available through white-labelling and open architecture so there is nothing by way of product that an international bank can provide that we can't. What we can do that is different is the tailoring of products, including domestic products, the location of service and the whole nature of the relationship."
Renaissance said it provides clients with a high level of service, an individual approach and flexibility in the management of their investment such as a no redemptions fee policy.
The company targets the top segment of the market and clients with a minimum investment size of $1 million. Actually, the average account size is in excess of this, at over $6 million, while the largest single account is just above $100 million.
Mr Jennings left CSFB to launch Renaissance Capital in 1995 and took control of the firm in the turmoil following the Russian debt crisis in 1998.
He has since transformed Renaissance into Russia 's first full service western-style investment bank and it has since gone from strength to strength, riding the wave of foreign investor interest in the country.
Mr Jennings, who has a controlling stake in the business rumoured to be worth $2 billlion, has rebuffed interest in his business from Western banks and state-owned VTB. He has said selling out would ruin the bank's reputation for providing clients impartial and independent services.
Renaissance recently launched its investment bank in Sub-Saharan Africa. Asset management and wealth management services will follow in time, according to Mr Jennings.
www.wealthbriefing.com
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