How wealth managers manage their own wealth

October 16, 2008

lamere.jpgPrivate bankers are guiding their rich clients into safer investments as financial market turmoil spreads, but when it comes to their own money they often take a different tack.
“I don’t have a very well diversified portfolio,” admits Timothy Vaill, chairman and chief executive officer of Boston Private Financial Holdings , which owns 15 independently operated financial services firms.
“The majority of my investments are in my own company,” he told this week’s Reuters Wealth Management Summit.
“And I invested additionally this quarter in my own company again because I really believe what we are doing is the right thing to do and it is a very strong company. And I’m there all day, every day, watching it like a hawk.”
David Lamere, chief executive of The Bank of New York Mellon’s wealth management unit, said his money is managed by his own company.
“I’m a big shareholder in BNY Mellon, and the rest of my assets is managed by our organization,” Lamere told the Reuters Summit. But his investments were “very diversified”, he added.
How much do they own?
According to Thomson Reuters data, Vaill owned 201,794 shares of Boston Private as of mid-August valued at about $1.8 million. As of Thursday afternoon, his stake would have retained its value at $1.8 million.
Vaill also said he does not borrow against his stock and does not invest in hedge funds.
Lamere owned 255,820 shares of Bank of New York Mellon as of May 9, valued then at about $11 million. As of Thursday afternoon, that was notionally valued at about $7.5 million.
Lamere said he was at a lunch on Sept. 18 when Bank of New York Mellon stock briefly fell 35 percent along with a slump in shares of other trust banks and asset managers.
“It all happened within about an hour in the middle of the day and I was in a lunch. I got called six times,” Lamere added.


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Most of Wealth Managers are many of the times plays with their on wealth rather playing with clients. In last 4 years (barring last 8 months), they were better placed. But now things have metamorphed totally and both clients and self portfolios are bleeding. Even debt and fixed income investments are in trouble.

Posted by Satyam Bhatt | Report as abusive

When sky falls every one will suffer, no doubt in it. Every one’s wealth will get reduced as well. But one has to understand that the investment will be with a surplus money one has and he should not expect to get it back when ever he requires. When the money invested increased many folds over a period of time one has to get it back even he doesn’t require at that minute. But one will invest then only a huge borrowed amounts and get into the trap of bare phase/slump in the economy.

Posted by balaji | Report as abusive