BTG Pactual banks on T. Rowe Price’s wide range of strategies for Andean effort

Following up on its initial announcement of its arrival in Latin America at the end of 2019, T. Rowe Price is ready to attract institutional clients in Chile, Peru and Colombia, with the support of BTG Pactual’s institutional distribution team based in Santiago.

Last October, BTG Pactual announced an alliance with T. Rowe Price and a month later brought in Mauricio Pérez Lavin as sales manager for the Chilean, Colombian, Peruvian and Uruguayan markets, precisely to strengthen the American manager’s arrival in the region.

Pérez, who for the last three years had been head of BlackRock’s institutional sales team in Chile and had previously worked for 10 years in the investment area at AFP Capital, took up the challenge of developing the sales strategy and positioning the US manager as an important player in Latin America.

In recent years BTG has developed a successful sales strategy in the wealth management segment, especially packaging alternative funds through local feeders. The idea for 2020 is to diversify by strengthening the institutional segment. “We will focus on clients such as AFPs, insurance companies and family offices in Chile, Peru and Colombia, where in general the dynamics of institutional investors look very much alike, since the regulatory schemes are very similar and a lot of know-how and investment philosophy is shared,” a senior executive of the firm said.

In this context, T. Rowe Price will be the “core manager” for BTG, since it has a wide range of successful strategies. “The idea is for us to become T. Rowe Price’s sales force in Latin America and we are very excited about this alliance,” the executive said. “Unlike other big managers, they have an investment DNA because their obsession is not to capture more and more assets, but to beat the long-term benchmarks.”

Pérez said that in January they had a visit from the portfolio manager of European equity, Dean Tenerelli, who held a road show with the main institutionals in the region, leaving a very good impression of T. Row Price’s offering.

The executive said they were now fine-tuning the basket of funds to be offered in the Andean Region, based on registering at least 10 strategies with the Chilean Risk Rating Commission (CCR) at the end of the year.

Asked if with this manager it is possible to cover all the strategies required by institutional clients, Pérez said they could cover most of them. “Perhaps for China they don’t have such a relevant strategy, but that is where we have our second manager, Krane Shares, which means we can offer alternatives in China when defining the global asset allocation. We also have an alliance with Evli, especially for corporate bond strategies in Europe.”

Finally, on the possible impact of the ongoing pension reform in Chile on the institutional distribution business, Pérez said the business outlook in Chile was good and in line with the growth of pension funds, which is around 5% or 6% annually.

“Evidently if, through the reform, more contributions are generated, there will be more assets available for investment, and so managers have to aim at delivering solutions for international investment,” he said.