Tonight I will publish a new report, “Emerging Market Bridges: All Eyes on Asia & Latin America for Fund Managers & Private Banks”, co-written with Jamie Maak, our London-based director of client services.

Jamie Maak, Strategic Insight Client Service Director

A few highlights below:

• Asia & Latin America drive private banking growth: UBS reported net cash contributions mostly from “strategic growth areas of the Asia Pacific region and the emerging markets”; Julius Baer’s emerging market flows offset low growth in the firm’s European offshore book – Asia now represents 15% of Baer’s assets, and the stake in Brazil’s GPS is a door into Latin America’s HNW investors; Credit Suisse’s asset management net revenues increased 25%, with strong gains to multi-asset class solutions, and performance fees up due to gains from Hedging-Griffo in Brazil; HSBC recorded double digit revenue growth from Asia and Latin America.

• Client projects and discussions center around Emerging Markets: Client projects for US and European asset managers are increasingly focused around Asia and Latin America strategies – both from an investment and distribution standpoint, largely driven by continued outflows from local developed markets versus broad-based gains from emerging regions.

• Absolute Return in Europe, West-to-East: With sovereign debt concerns, year-to-date results for locally-domiciled European funds show pronounced fixed income outflows, but many cross-border international funds continue to expand, especially in the bond space – and with contributions from Asia. Additional gains year-to-date come from absolute return strategies, commodities and multi-asset class solutions.

• Asia flows show continued opportunities: The region’s local inflows are more than double those of local Europe. Unlike in Europe, Asian investors showed little fear over defaults, with $11 billion year-to-date in fixed income flows locally alone. Top-selling themes include: high yield, Australian dollar, Renminbi and convertible themes.

• Broad-based Latin America appeal: $30 billion in year-to-date bond fund flows in Brazil and an overall $1 trillion local industry attract international fund managers strategically, while existing cross-border fund flows to pension funds in Chile, Peru and Colombia offer current and future growth. Asia themes feature prominently in pension funds for all three markets.