BNP Paribas remains a one star manager
Morningstarhas confirmed sBNP Paribas’one star manager rating following the qualitative assessments of its subcontracted investment management and international equities relationship with Massachusetts Financial Services (MFS).
The research house says despite a rigorous subcontracted investment manager selection process, high staff turnover has led to a serious staff shortage at BNP Paribas.
“This is stretching the workload of BNP Paribas’ investment strategist David Roberts who, in addition to his other responsibilities, is charged with the monitoring of external manager mandates,” the report says.
Prolonged staff turnover and continuing poor performance by BNP funds were the reasons cited by Morningstar for its initial downgrading of the manager to one star late last year.
Last year saw the departure of BNP Paribas’ chief investment officer and head of asset allocation Robert Ellis, group head of fixed interest Rohan George and the head of Australian equities Brian Ingham.
BNP Paribas’ subcontracted international equities manger, Massachusetts Financial Services, had not previously been rated qualitatively by Morningstar.
The research house issued a ‘positive’ sector strength rating for the group due to its solid research process, however Morningstar does have concerns over its highly manual portfolio construction process which leads to a possible key person risk.
There has been no change to the distribution of Morningstar star ratings for BNP’s funds as a result of the qualitative reassessment, with five of the manager’s seven funds retaining either a one star ‘very poor quality’ or two star ‘poor quality’ rating.
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