MoraBanc's Lorenzo Casaus outlines the key pillars of the firm's business strategy, including recent agreement with Goldman Sachs AM, aimed at creating a more agile and digital organisation with the focus on clients.
Launched in Andorra by the Mora family in 1952, MoraBanc remains family-owned, giving it a stability throughout the decades that allows the bank to think long term while continually adapting to what the client needs.
The Andorran bank, which currently manages €6.54bn in assets, is split 81% private banking; 10% institutional; and 9% wholesale.
As part of our current business plans, we are focusing on offering investment services to our clients rather than becoming mere distributors of products."
Headquartered in Andorra, MoraBanc has also offices in Zurich and Miami via its fully owned subsidiary Mora Wealth Management, which specialises on independent advisory.
Earlier this year, the Bank announced the restructuring of its investment teams into four departments in a move aimed at improving efficiency and client service.
The new Strategy & Investments area resulting from the reorganisation, led by chief strategy and investment officer Lorenzo Casaus, includes four departments: MorabancAsset Management, led by Oriol Taulats and focusing on discretionary and fund management; advisory, led by Enric Galí; fund selection, a newly-created department led by Juan Hernando, and corporate strategy, under Miguel Ángel Delgado's leadership.
When asked for the main reasons behind the merger, Casaus explains: "There are two main reasons. First, upgrading our services to provide comprehensive investments solutions to our clients is one of the pillars of MoraBanc's business plan and most of the strategic projects we run, were conducted in conjunction with the different investment teams: advisory, fund selection and asset management. Secondly, MoraBanc is complementing its historical product range with a renovated range of discretionary and advisory services , for which it was vital to have a unified leadership team to make sure all our cross-asset experience is passed to our clients."
The restructure followed the strategic deal MoraBanc and Goldman Sachs AM (GSAM) reached earlier this year, which gave MoraBanc's clients access to GSAM's range of investment portfolios designed by the US investment bank specifically for the Andorran bank. "In our view, it puts Morabanc in a privileged position in terms of wealth management, planning, and client advisory," reckons Lorenzo Casaus.
Both moves are part of MoraBanc's business strategy, which was launched last November with the objective of transforming the organisation into a 100% client-oriented company, according to MoraBanc.
Casaus, who highlights that the Bank keeps on transforming its business as it has been doing for many years, says: "The firm's business plan (called internally Plan 360) was launched in 2018 with the goal of transforming the organization into a 100% client focused firm. To do so, we are focused on creating a more flexible and less complex organisation that delivers a new set of value-adding wealth management services leveraged on best-in class agreements."
He continues: "The need for adaptation has become even more relevant in the recent years as MoraBanc has expanded to new international markets, financial regulation has evolved, and our clients' needs have become more complex.
"As part of our current business plans, we are focusing on offering investment services to our clients rather than becoming mere distributors of products: offering wealth management services via discretionary and advisory investment solutions, which are global, built around our cross-asset expertise and leveraged on partnerships with best in-class players. In addition, we are simplifying our product range in order to focus on our areas of expertise where we think we can add Alpha. We are also reinforcing our investment teams."
According to Casaus, designing a well-defined and methodical plan to extract value from fundamental and valuation-based metrics while focusing on risk management are two of the key drivers for achieving long-term sustainable returns.
He says: "We believe that a strong emphasis in risk management is paramount to achieve our goals efficiently. We therefore incorporate our strong quantitative skills into our valuation based return drivers in order to accomplish the best possible risk-adjusted returns."
With regards to MoraBanc's asset allocation, Casaus outlines that the bank is positive on equities despite admitting that first quarter of this year may end reducing the asset class' potential.
He adds: "From our point of view there is a structurally less recession-prone now, with anchored inflation and reduced impact from oil. In equities, we find the US attractive in spite of its valuations, which may look expensive according to the traditional metrics.
"Although we are invested in Europe, political uncertainty remains across the continent so we are more positive on US and emerging markets," he says.
The Andorran bank has also positive views on emerging markets, both in equity and fixed income.
Casaus comments: "We believe emerging markets present Good investment opportunities.
"When you focus on a company fundamentals instead of on the country where they are based, you may identify companies that have been unfairly punished in recent months."
Conversely, he admits to being cautious on investment grade corporate as well as on US and German government bonds, in particular after the good start of 2019.
Enhancing the discretionary and advisory services to clients through the agreement with GSAM while focusing on the strategies they can generate alpha with are some of the bank's top priorities for the remainder of the year.
"Another important priority, at a company level, is to continuing the digitalisation of the bank, since part of our value proposal is based on innovation while on delivering the best solutions to our clients. To do so, the bank is not only developing in-house solutions but also partnering with the most innovative technology suppliers/fintechs," Casaus explains.
At a global scale, MoraBanc is revising its product range focusing on those funds where it believes it can add some alpha.
Although most of the bank's own investment products have been traditionally domiciled just in Andorra, the firm recently registered three of its funds in Luxembourg in order to distribute them abroad.
The three strategies -Mora Iberian Equity, Mora Global Currencies and Mora Absolute Return Luxembourg - had a great track record in their Andorran versions, underlines Casaus: "Since these funds were outperforming indexes and peers, we decided to launch Luxembourg vehicles as there were interested investors abroad. This is an exciting project with international growth potential."
When asked by the key people skills MoraBanc may be looking to boost, Casaus stresses talent. According to the bank's CIO, talent is the main competitive advantage in today's financial services.
"We are always open to talented people. We are looking to boost talent in most of the areas of the bank but especially in client servicing, technology and investment services.
"Additionally, we are collaborating with leading international firms in product development and technology. The main goal is to specialise in clients servicing while offering them the best solutions of the market," he concludes.