When Credit Suisse earlier this month announced it recruited three key players from the ING Investment Management Australian equities small cap team, it represented an important signal to the market: that Credit Suisse Investment Management will be around for the long haul.
It was a timely message in circumstances where events in Europe and the US had earlier this year created speculation among some commentators about the future of Credit Suisse in the investment management space.
Credit Suisse executive vice-chairman and head of asset management in Australia Keith Ince makes no bones about the recruitment of the ING small caps team being part of a broader strategy that reflects “a renewed vigour by the group to re-establish a strong asset management business globally”.
He makes the point that the activity in Australia is part of a broader push on the part of Credit Suisse that has already seen a lot of resources going into the south east Asian region, which includes Australia.
Ince said Credit Suisse’s Hong Kong office was being beefed up, while a key member of the Australian executive team, Robert Manne, was relocating to Singapore to take on a chief investment officer role.
He said these measures also needed to be seen in the context of the group also establishing strong and very successful joint venture arrangements in Korea and China over the past year.
And the reasoning for all this reinforcement of Credit Suisse’s asset management capability is simple.
According to Ince, it is the forecast rapid growth in net disposable income in Asia and the wealth that is therefore being accumulated.
“With the underlying growth in the Australian market forecast to grow to $3.5 trillion in the next eight or nine years, it is really important for Credit Suisse to focus on how it can be best positioned,” he said.
“We see that as a combination of being a local manufacturer in terms of traditional asset management products — fixed income and equities — and also really drawing on the group’s strengths globally, which is in the alternative investments area,” Ince said.
“In other words, we see it as being a combination of being a local manufacturer and drawing on global skills.”
Ince acknowledged that what he is confronted with is something of a rebuilding exercise in circumstances where, back in 2001, Credit Suisse was very highly credentialed in terms of domestic equities and there was about $7 billion under management.
“For various reasons, that’s no longer the case,” he said.
“Quite frankly, there have been some legacy issues regarding how Credit Suisse handled the process, and the message we want to send is that we are committed to the business and we are committed to a high level of communication in terms of the way in which the funds are being managed and how we communicate performance in terms of asset consultants and planners,” Ince said.
While Credit Suisse is now looking to consolidate its Australian equities teams under the guidance of former Schroders staffer Stephen Giubin, Ince does not rule out further specific headhunting exercises.
“It is likely we’ll recruit at least one additional person into the large cap space,” he said.
