Summit Notebook

Exclusive outtakes from industry leaders

No more musical chairs in banking industry-Merrill exec


rahul.jpgAs global markets rallied over the past five years, talent in the private banking industry had become a heavily fought over commodity. Rain makers, top bankers and entire teams were poached constantly by rival organizations who offered top dollar for the move.

However the unprecedented financial crisis has dramatically changed the talent landscape, with rookie bankers facing a harder time to move up the ladder, said a Merrill Lynch executive.

“Musical chairs are not taking place. People with limited experience, with fewer assets are not today being seen to move in the manner that they did in 2006, 2007,” said Rahul Malhotra, head of Asia-Pacific Advisory for Merrill Lynch.

Malhotra also said that the pace of growth in the wealth management industry outstripped the pace of growth in its talent pool.

Hedge funds get that shrinking feeling


rtr1yerw.jpgThere’s no shortage of commentators lining up to opine on how much the troubled hedge fund industry is likely to shrink as the credit crisis unfolds.

So when someone talks about the industry being in “meltdown”, it is good to see they are backing up their dramatic views with some dramatic actions.

We’re in this mess now, so stop moaning!


rtr58um.jpgRegulation is a word bankers love to hate.

But according to Sebastian Dovey, managing partner of wealth management consultancy Scorpio Partnership, they need to spend less time moaning about it and more time working with regulators to communicate the benefits of the industry.

“It’s not good enough to sit back and say this is going to cost us,” he says. “We’re here now, we’re in this mess. We’ve got to try and manage our way out of it.

Audio – Kuwait Finance House sees silver lining in downturn


lim-boh-soon.jpg Lim Boh Soon, chief executive officer of Kuwait Finance House in Singapore said at the Reuters Wealth Management Summit that he sees the period of downturn in the global economy lasting 18-24 months.

However, he thinks the market sell-off over the past two weeks has thrown up good value and said the Middle Eastern bank will look to raise up to $600 million for three Asia-focused funds next year.  Kuwait Finance House is the Gulf third-largest lender.

Obama has support among the wealthy


feurtado.jpgBarack Obama may be looking to boost marginal tax rates for the wealthiest 5 percent of Americans, but that doesn’t mean the wealthy are shunning the candidate, said Richard Feurtado, BlackRock’s head of wealth management in the account management group.
In fact, about 50 percent of BlackRock’s ultra-high net worth clients are Obama supporters, Feurtado said at the 2008 Reuters Wealth Management Summit in Boston.
“People do things for all sorts of reasons, and maybe one of them is financial, but there are many other reasons for people voting in certain ways,” Feurtado said.

A philosophical look at the habits of the super-rich


rtx8vgi.jpgThe credit crisis may be hitting the man on the street hard, but spending by the “other half” on the latest super yacht or Damien Hirst work of art looks set to carry on relatively unaffected.

Super-wealthy individuals in commodity-rich areas such as Russia and the Middle East are reaping the benefits of a five-year boom in oil and other commodity prices.

Audio – Not just a U.S. problem

buzz1.jpgThe problems at U.S. automakers have many obvious effects on the national, state and local economies in the United States, but those effects are felt in Canada as well and they have left one long-time industry observer fearful.

Buzz Hargrove, former president of the Canadian Auto Workers (CAW) union, expressed some of those concerns on Wednesday at the Reuters Autos Summit.

Audio – Why help Detroit?

tim1.jpgAs with most issues, there are two sides to this one as well. and both were heard this week at the Reuters Autos Summit in Detroit.

The U.S. government has committed to spending $25 billion to help the U.S. automakers finance needed changes in production, manufacturing and design. And if the Detroit automakers get their way, that number will end up being more like $50 billion.

Audio – Fritz Henderson: Raw!

henderson2.jpgOK, that headline might be a little bit misleading for a posting about the difficulty of predicting raw materials prices, but it catches the eye.

Fritz Henderson, chief operating officer of General Motors Co, told the Reuters Autos Summit this week about how the wild price swings in critical raw materials make it especially difficult to predict profitability and margins.

Audio – But who knows where or when …

mulally4.jpgIt’s an old song of course, made famous during World War II, but the sentiment rings true for the U.S. auto industry these days.

For Ford Motor Co. Chief Executive Alan Mulally before the automakers can really see a meaningful turnaround a number of factors need to be present — and almost all of them deal with a stronger consumer situation.