Deutsche Asset Management (Deutsche AM) has beefed up its Deutsche X-trackers team in the US through several senior hires in its portfolio management division. Patrick Dwyer and Brandon Matsui join as portfolio managers and directors. Both will be based in New York, reporting to Bryan Richards, head of passive portfolio management.
Dwyer and Matsui are part of a 'broader group of strategic hires' that the firm has made this year to support the growth of its Deutsche X-trackers business in the US. Deutsche AM rolled out its US multifactor suite in late 2015 with the Deutsche X-trackers Russell 1000 Comprehensive Factor ETF and the Deutsche X-trackers FTSE Developed ex US Comprehensive Factor ETF. The bank's multifactor suite was expanded with the launch of Deutsche X-trackers FTSE Emerging Comprehensive Factor and Deutsche X-trackers Russell 2000 Comprehensive Factor exchange traded funds (ETFs), earlier this year.
Fiona Bassett (pictured), head of Deutsche's passive asset management unit in the Americas said the appointments respond to the bank's building out of its passive business in the US as part of the bank's broader strategic plan for its Americas Asset Management franchise.
Dwyer joins Deutsche AM from Northern Trust where he most recently held the role of head of international equity index portfolio management for North America. He has 15 years of global equity index portfolio management experience. Prior to joining Deutsche AM, Matsui was a senior portfolio manager at Charles Schwab, responsible for leading the development of its fixed income ETF offerings. Matsui joined Charles Schwab in 2010 from BNY Mellon where he was an associate portfolio manager on the Beta Management team. Prior to that, he spent five years at BlackRock Solutions, where he served as an analyst in the portfolio analytics group, and also a risk analytics manager for their corporate, asset management, and pension clients.
The additions to the X-trackers team follow the bank's decision to streamline its wealth management focus after the sale of its US Private Client Services (PCS) business earlier this month. Deutsche Bank Wealth Management said it will focus on making strategic investments in its US Wealth Management business after successfully closing the sale of its US PCS unit to Raymond James Financial, Inc.
The unit will continue to operate under the name of Alex. Brown, a division of Raymond James. The agreement was originally announced in December 2015. Under the agreement, Deutsche Bank and Raymond James will preserve and enhance the value proposition for Alex. Brown clients through a strategic distribution arrangement, providing access to certain Deutsche Bank products and banking services.
Raymond James is an active distributor of structured notes and market-linked certificates of deposits. The US investment and financial planning firm has 18 live structured notes in the US market, according to SRP data.
The sale of the US PCS business is in line with the bank's Strategy 2020 goal to become 'a simpler and more efficient organization', according to Fabrizio Campelli, head of Deutsche Bank wealth management. Deutsche Bank AM will now concentrate on building its wealth management capabilities for ultra-high-net-worth clients in the US by focusing on a single distribution channel, underlined by a series of recent senior appointments including Patrick Campion, who joined the bank last month as head of Deutsche Bank Wealth Management for the Americas.
With €719bn of assets under management (as of June 30, 2016), Deutsche AM is one of the world's leading investment management organizations. Deutsche Bank remains a second tier issuer in the US retail structured products. Year to date, the German bank has slipped out of the top 10 issuer ranking after a decrease in issuance (119 products/US$649m) compared to the previous year (422 products/ US$2.5bn).
The German bank reported a significant decrease in equity derivatives revenues driven by lower client activity and challenging market conditions. In wealth management, revenues also declined by 12% to €490m, reflecting lower performance and transaction fees driven by the more difficult market environment, including very low levels of equity capital markets activity in the US, while in asset management revenues were €706m, down 8% y-o-y.
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