The purchase of a stake in a UK-based firm suggests that Vontobel is joining a trend of wealth and asset managers tapping into an infrastructure market that is being driven by a number of forces.
Swiss wealth and asset management firm Vontobel has reported
today a pre-tax profit of SFr262.7 billion ($300.8 billion) for
2023, slipping 2 per cent from a year before, while logging
SFr1.305 billion in operating income, up 2 per cent.
The Zurich-listed business also announced today that it is to acquire a “significant minority stake” in Ancala Partners LLP, a London-based independent private infrastructure manager. This transaction marks Vontobel’s entry into institutional private markets, and chimes with a trend of other firms buying into the $1 trillion infrastructure story, notably BlackRock.
Vontobel said that its operating income was driven by stronger revenues in wealth management. Its cost/income ratio was at 79.5 per cent, up 1.1 percentage points, due to additional investment in the wealth arm.
The firm’s Common Equity Tier 1 ratio was at 18.7 per cent, up 2.0 percentage points.
Operating income in wealth management rose by 16 per cent to
SFr746.9 million in 2023. Asset management contributed SFr384.1
million. Digital investing posted an operating income of SFr154.3
million on slightly lower client transactional activity.
The firm’s assets under management increased by 1 per cent to SFr206.8 billion, mainly driven by the market recovery in the fourth quarter.
The firm said that its deal with Ancala will “enable clients to benefit from the potential for diversification supported by low correlation to GDP and other major asset classes, as well as attractive risk-adjusted returns."
Ancala, which was founded in 2010 and has total AuM of more than €4 billion, manages 18 assets operating in essential infrastructure sectors including renewable energy and energy transition, transport, utilities and the circular economy. The firm recently closed its third flagship fund which raised €1.4 billion in commitments, surpassing its target.
“This stake in Ancala is an important milestone in the execution of our strategy. Providing access to the highly attractive private infrastructure market means clients can benefit from stable, uncorrelated and inflation-protected cash yields, and long-term value creation through Ancala’s active asset management and proprietary origination capabilities,” Christel Rendu de Lint, co-CEO of Vontobel, said.
Co-CEO Georg Schubiger added: “With this transaction we are diversifying our business with an asset class that has significant long-term potential, thus attractively enhancing our offering for clients.”
On a day-to-day basis, Ancala will continue to be run
independently by its management team, led by managing partner
Spence Clunie, and will retain full independence over its
investment and governance processes.
Vontobel will pay for the Ancala stake from existing capital. Subject to regulatory approval, the transaction is expected to close by the third quarter of 2024.