AUSTRIA - The banking and management group Erste has created Erste Asset Management (EAM), a new umbrella to combine all of its asset management business in Austria and the CEE region.
The new operation will hold a total of €33.8bn in assets under management and have 300 employees across the various asset management operations in Austria, Slovakia, Croatia, Hungary, Romania and Germany.
Asset Management subsidiaries in the Czech Republic and Serbia are still to join the new umbrella organisation.
“With our know-how of the local markets through our local employees, we want to establish ourselves further as a specialist for pension fund asset management in the CEE region,” said Christian Schön, a new recruit at Erste and board member of EAM who is tasked with increasing EAM’s institutional busines.
Schön has joined Erste from DWS Austria where he was CEO and co-head of European institutional distribution at Deutsche Asset Management.
“Over the last few years, the growth of the second and third pillar pension systems in the region has also created a challenge for asset managers,” explained the new board member.
“From just €13.5bn in pension assets in 2002, the market has grown to €65bn by 2008 and we expect further two-digit growth annually which should mean around €200bn will be invested in pension funds in CEE by 2015.”
He said EAM’s focus will for now be directed at the largest pension markets in Hungary, the Czech Republic and Poland.
Although other markets like Romania have more growth momentum, they are still considerably smaller because they started later than others, he pointed out.
Looking specifically at Poland, Schön said he expects the authorities to loosen investment restrictions on foreign assets from a 5% cap to a 10% cap and for pension funds to make use of this diversification.
“The new organisation allows us to bundle strengths across the region and increase efficiency in risk and asset management,” explained Heinz Bednar, chairman of the board at Erste Asset Management as well as CEO of Erste Sparinvest (ESPA) - one of the subsidiaries to join the new structure.
When asked whether the restructuring at Erste was part of a recovery after the global financial crisis, Bednar said the plan to create EAM had already been drawn up in 2007 but added “the crisis has strengthened our resolve”.
“However, we will still remain as local as possible, tailoring solutions to individual clients needs in the various regions,” he stressed.
This also means that the names of the various asset management subsidiaries like Investicní spolecnost Ceské sporitelny (ISCS) in the Czech Republic or Ringturm KAG in Austria, which the Erste acquired recently, will be maintained.
Bednar and Schön are joined on the board by Harald Gasser, head of ESPA Financia Advisors, and Franz Gschiegl, board member at ESPA.
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