InterSec 250 rankings 1 to 50 and 101 to 250
InterSec 250: Foreign-owned, operating under a different name
At the end of 1997, the InterSec ranking shows the total assets under management by the top 250 managers domiciled outside the US to be $13.7 trillion. This represents only marginal growth over last year but, given the dollar’s strength, and the exclusion of US-based managers, it is perhaps more remarkable that there has been any increase at all.
The proportion of funds managed from outside the domicile of the parent company has increased from 22% to 25%, indicating the continued rapid internationalization of the investment-management industry. A number of related trends contribute to this.
First, institutions have continued to buy and establish foreign subsidiaries. Second, in some cases asset management is becoming more decentralized with business moving to regional centres. Third, much asset management is converging on major centres (such as London) which may be outside the domicile of a group’s headquarters. Fourth, management of funds is being outsourced to foreign managers (though some of this may not be declared, understating the total).
Excluding Japanese companies from the figures raises the foreign-managed percentage to 34%, again a significant increase over last year’s figure. It should also be noted that the bulk of the foreign-managed portion is attributable to the global companies such as UBS and Barclays Global Investors at the top end of the ranking.
There are many reasons for caution in interpreting any analysis of domestic versus foreign location of asset management, not least the difficulty in defining the geographical location of the decision-making process, which may be split between offices. It does, however give an indication of the extent to which major companies are loosening their ties to their home countries.
Since all the figures have been converted in US dollars, exchange-rate movements have significant effects on the geographical shape of the ranking. On average, UK managers’ rankings have risen since last year, as have those of managers based in Canada, while Australian managers suffered both from exchange rates and proximity to Asia.
In Europe, the French Franc and the Deutschmark moved by much the same extent against the dollar, but French managers fared worse. All French asset managers fell in the ranking, German managers, on the other hand, are roughly evenly distributed between climbers and fallers.
Major mergers and acquisitions define the big movers, and some of the biggest have happened since the year end. The UBS-SBC deal places the new UBS on a par with Kampo (1) – adding the December 1997 figures gives the group an estimated $820 billion under management. Credit Suisse rises from seven to five with the purchase of Winterthur, and Zurich Insurance from 21 to 12 with the purchase of Scudder. Adding the Zurich purchase of BAT’s fund management arms will raise the groups assets under management to $375 billion, lifting it to around fifth place.
Generali’s (51) purchase of Aachener & Münchner Beteiligung (85) would now place the Italian insurer around the late 20s in the ranking. Within Germany, Hypobank (including Foreign & Colonial) and Bayerische Vereinsbank (formerly 58 and 93 respectively) merged to rank 29 this year. In the UK, the merger of Commercial Union (27) and General Accident (73) lifts the combined group into the top 20, while the creation of Indocar (24) lifts Crédit Agricole from last year’s number 33.
