Groupama AM CEO outlines growth plans

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Groupama Asset Management, the investment subsidiary of French insurer Groupama, has posted over €3bn of net inflows from third-party customers over the eight first months of 2017, having equaled its 2016 inflows.

Total assets under management of the firm were standing at €101.5bn as at end of September 2017, of which external clients’ assets accounted for 20%.

In a interview released by Groupama AM, the chief executive officer Philippe Setbon (pictured) has discussed the current state of the manager and unveiled its future growth plans.

He argued that long-term savings solutions are particularly sought by today’s investors, and that the trend was visible through the take-up of Groupama AM’s equity and absolute return products.

“This progress is the fruit of efforts to rationalise and reposition our offering to clients, within the framework of our former strategic plan. From 2015, we worked on diversifying our distribution offer. Today, our business is developing rapidly within this segment, with approximately €1.5bn of inflows since the start of the year. The increased presence of Groupama AM among private banking clients and fund distribution platforms is an important strategic driver of our growth.

“We are departing from our previous strategic plan 2013-16, thanks to which we have managed to reduce our cost base and maintain quality of management. The result is that today our objective has been reached: a return to profitability and a cost base in line with the parameters of the benchmark that we implemented,” underlined Setbon in the interview released.

Now the firm looks at rolling out its new development strategy called GAM 2022 which shall see Groupama AM adding new investment capacities over the coming years. Attracting new talent and digitalising the company also remain among the manager’s priorities.

Speaking to InvestmentEurope, Setbon said that in line with the GAM 2022 strategy, Groupama AM aims to widen its offering range in terms of asset classes, such as loans, infrastructure, and private equity. “We are currently studying partnerships to complete our portfolio expertise,” he exposed when asked about an eventual participation of Groupama AM in the ongoing M&A activity seen in the asset management landscape.

Seeking expansion in LatAm and the Nordics
Groupama AM’s international activity – outside of Switzerland and Belgium – has contributed to gather €1.2bn between January and September 2017.

“Outside France, Spain and Italy are our most important markets in terms of attracting assets. The management we offer, via our Italian subsidiary and our Madrid branch, is designed for pension funds and distribution professionals. Other growth channels we have identified are in Latin America, a region that Groupama AM approaches via an intermediary network of third-party marketers. We have just finished a series of roadshows, which have enabled our team to capture new subscriptions, predominantly from institutional and pension fund clients,” CEO Setbon said in the interview released by the firm.

“We currently focus on Chile, Peru and Colombia,” he told to InvestmentEurope, adding that the firm aims to expand in the Nordic markets with the support of third party marketers.

Orange Bank’s offering
As a number of firms have recently converted their France-domiciled funds (OPCVM) into refurbished French Sicavs said to be more attractive for Northern Europe’s investors, Groupama AM’s CEO explained to InvestmentEurope that the opportunities raised by French regulator AMF’s move in that field is being studied by the manager but no decision has been taken yet.

The firm does shelter an in-house multi-management unit focused on flexible funds with a risk-controlled approach. “Assets under management are stable this year, standing at €1.1bn as of end June 2017,” said Setbon.

Another hot topic for Groupama AM is the recent transformation of Groupama Banque into Orange Bank, as the activity has been acquired by French telecom giant Orange which, among others, is set to launch digital banking services as from 2 November 2017. Setbon told that “as of today, Groupama AM funds are included in Orange Bank’s range of funds offered.”