A genuine concern for management companies

Year 2007 will be that of the "quiet failure" for the French collective management It will all be rather than chosen suffered case because it is Europe, through the directive on markets in financial instruments or MIF (read box), which will provide the impetus for this transformation. Actors to adapt before November 1, date deadline. The French Association of financial management (AFG) just tasked the firm PricewaterhouseCoopers to evaluate the cost for the whole of the French management companies. The British regulator has already made a first estimate for the whole of its financial sector (issuers, banks...): 1 billion pounds. This is not a painless puncture...

"The implementation of the recommendations of the Delmas-Marsalet report (for a better marketing of financial products) and the MIF directive will be a good opportunity to see if the"better regulation"(Editor's Note: new approach to regulation which aims to take into account more cost that it induces) decided by the MFA is well followed by tangible effects, insists Alain Leclair President of the AFG.". Thus, we do not wish a regulatory addition which would be in addition to the already heavy constraints linked to the MIF. "" This last directive, apparently very ethical, is finally enough evil. " Many interpretations are still possible on essential points, of which some will be cleared by the Committee of European regulators in the first half of 2007. A genuine concern for management companies.

An election year

Mobilized for the construction of the MIF, management companies did not forget that 2007 is an election year, with the risk of more or less rule proposals this type of event can raise, as "opportunistic of the rules of the tax game modification", fears and Alain Leclair, President of the AFG. Concerns are particularly strong in the world of the savings. "At the sight of certain electoral programs, we fear that, once more, the savings is lessened and penalized through mechanisms such as the expansion of cases where the participation can be released early." "This type of measure, which has already proved ineffective in the past to stimulate consumption, injurious to the savings made by employees for their retirement, and in addition to the employee share ownership, since almost half of the flow of the participation is addressed to him", insists Hughes Colmant, Director General of BNP Paribas Epargne & retirement companies.

The industry's lobbying will be to consider the candidates on the consequences of their decisions and promote certain ideas in the field of pensions including. "It is quite surprising then, that a question also central and major funding for a system defined contribution pensions is largely absent from the current political debate," said Alain Clot, President and CEO of Société Générale Asset Management (SGAM).

These changes in the environment will in any case occur in a profitable sector, which has now erased the stigma of the Internet bubble and comes close in addition a very good year (read below). A French market that will have a new giant in size, Natixis AM. The emergence of this very franco-français Mastodon seems hardly disrupt the sector gives nor disrupt its competitors, that point the large work of reorganization and rationalization that it will have to lead, not to mention the operational risks associated with this type of operation, as the departure of talent. In France, "strong regulation, perhaps more than the game of the competition, helped sort in actors and to exit the market those who do not have the means to meet these constraints, note Alain Clot.". The French market is also one of the most difficult in the world; "report of force is clearly for distributors to the producers".

Foreign actors who continue to arrive in Paris for two to three years are well aware. An acquisition can allow them to save time. Thus, is Robeco the active search for a small company of French management on actions for a few months. He has that choice in view of the multitude of French shops specialized on this asset class.

Essential American market

It is across the Atlantic that larger-scale initiatives could be held in the reconciliation. This market is essential for French asset managers who wanted to be real multinational management. It is AXA Group, recently mounted in the capital of the American Manager Janus, who could pass top speed. The acquisition would make sense according to some observers. They note a good complementarity between the two, including the American of AXA IM, Rosenberg, subsidiary whereas the reorganization seems finally completed in Janus. Credit Agricole Asset Management has still not materialize its desire to grow across the Atlantic.

After two very favourable years on stock markets, managers may not exclude a return of the yields to their historical average of long term, around 6. Obligations, the so-called "absolute performance" approaches (see below) should be still preferred by investors.

Other carrier themes: "equity, restructurings and OPA;" "on the obligations, a comprehensive approach, one of the few to be really useful in an environment of lasting low rates and differences in performance at a low level", said Thierry Callault, Director General of Ofivalmo. The use of the funds of arbitration, including through funds of funds, is expected to continue this year, now that "the alternative management regulatory framework is well established, explains Philippe of Anterroches, CEO of UBS Global Asset Management." We will now be attentive to the new British regulations on alternative management, in particular to the eligibility criteria to an arbitration Fund is a Fund of funds. Can only wish that these criteria are close to both sides of the channel. The United States, it will need to follow the debate on the registration of "hedge funds" with the SEC. "Only arbitration funds registered with a national regulator are likely to be integrated into a Fund of funds under French law". The use of more massive and natural institutional French alternative management should in theory allow for better cross the turbulence in the traditional markets, playing a role of damper and diversification. 2007 may be a good test on this point.