US investment managers Alliance Capital and Italian financial group Eptaconsors in Milan have signed an agreement for investment management and fund distribution targeting the Italian institutional and retail markets.
This will be done through Eptafund, the mutual fund and pension fund management operation of the group with $4bn under management, which is made up of six leading banks, with 1,500 branches.
We believe in in the future growth of the pension fund and mutual fund market here," says Eptafund chief Marco Bolgiani. "We wanted to get the agreement in place for the pension business and the launch of new funds."
In New York, Alliance Capital's John Groom says: "We will be working with Epta on the two areas of pension funding for the open pension plans and the closed schemes for some of the largest institutions and unions. We are seeing some RFPs for some of these newly formed funds and we will be working closely with Epta in trying to win those mandates."
Eptafund is setting up open pension funds for five of the banks in the grouping and is awaiting authorisation for these. "We are launching six mutual funds on a geographical basis and Alliance will manage these," says Bolgiani. But he is also expecting de-mand for discretionary accounts to grow. "This is an almost non existent market at present."
The agreement with Alliance is for all investments outside Italy for both funds and segregated accounts. It will also distribute its offshore funds through Eptafund.
Groom says that the Italian group is early on in the process of converting their bank deposit base into mutual funds compared with others. "We bring the foreign asset management capability that Epta does not have."
Bolgiani says that the euro will mean that Italians will invest more in Europe and less in Italy and that Alliance will be managing these for a period of time, when it will be discussed. "We wanted a sub advisory agreement rather than selling the products of some one else." Fennell Betson"