Research house row ends

Stephen van Eyk

A two year-old rift between retail fund manager UBS Asset Management and research house van Eyk over a perceived conflict of interest appears to be over.

Both parties have confirmed to MoneyManagement that they have “entered into a dialogue” aimed at resuming their professional relationship, which ended acrimoniously in April 2005.

“We have commenced a professional dialogue to pursue a mutually beneficial arms length business relationship with van Eyk in the best interests of our clients, UBS managing director Paul Bolinowsky said.

The relationship ended when UBS Asset Management withdrew its funds from van Eyk’s research process after a dispute over the researcher’s involvement in funds management.

The involvement began with van Eyk’s launch of its Blueprint series of funds, and expanded last year when it launched its own listed investment company, van Eyk Three Pillars.

Former UBS managing director Colin Woods explained his decision to withdraw the funds by announcing UBS “wasn’t going to allow a rival manager to have access to the details of how we manage our funds”.

Woods has taken up a senior role with UBS in Asia and Bolinowsky declined to discuss the company’s previous approach.

“I’m pretty disinterested in revisiting the past and, besides, I cannot comment on that issue because I did not have responsibility for the business at that time,” he said.

Describing himself as “delighted to have recommenced a dialogue with van Eyk”, Bolinowsky said a “productive relationship with all of the research houses in Australia is obviously in the interests of our clients”.

“Van Eyk is a prominent provider of research to many channels within our investment community and, therefore, it’s prudent for us to revisit the state of our relations with it.

“Our rationale for doing so is to try to provide investment solutions in the best interest of our clients,” he said

Van Eyk director Stephen van Eyk described the dialogue as “consistent with our longstanding attitude that UBS are very good at certain sections of the market that our investors should potentially have access to”.

“It is a major player in a lot of complex investment sectors, including, for example, global fixed interest, which we would want our clients to have (unfettered) exposure to.”

Claiming there’s “a will on both sides” for the negotiations to succeed, van Eyk said the “desire to rate them (UBS products) and see how good they are” was motivated solely by the interest of its clients.

“We don’t charge for our ratings, so there is no financial motive in it for us. Instead, it’s purely a desire to put our hand on our heart and say we are bringing our investors the best investments we can possibly make.”

He added that the lack of a relationship with UBS over the past two years had left him “wondering, naturally, if the products in our mix have been the very best that we could have been using to build our client’s wealth”.