Long term saving and financial education: Salone’s ingredients for a healthy AM industry

Salone del Risparmio, the annual gathering of the Italian fund industry produced another record turnout.

In its fifth consecutive year, the annual gathering of Italy’s asset management industry, organised by trade association Assogestioni, did not lack insights or surprise.

Registering another record number of visitors – 13,000 by the end of the three days – the event showcased some 100 sessions revolving around five main themes such as Tailored Portfolios, The Systematic Value of Asset Management, Financial Information and Education, Certified Education, and Regulation and Tax.

Across the debates, however, long term savings, financial education and the necessity to relaunch access to credit for SMEs emerged as the main watchwords of the whole event.

Assogestioni’s new board, with an international flavour
Assogestioni did not miss the chance of opening the Salone with a surprise, by announcing, alongside the new presidency of Pioneer Investments’ Giordano Lombardo, that of the three new vice presidents, which included for the first time the head of a foreign asset management company.

Sergio Albarelli, senior director of Southern Europe & Benelux and country head of Italy at Franklin Templeton was appointed as vice president of the association together with Tommaso Corcos, CEO of Eurizon Capital SGR and Santo Borsellino, CEO of Generali Investments Europe SGR.

The new president Lombardo, group CIO at Pioneer Investments, had replaced former president Domenico Siniscalco by default since mid-November 2013, when the latter stepped down for “potential conflict of interest between his role as Assogestioni’s president and that of president of an international investment bank [Morgan Stanley],” an official note said at the time.

The appointment of the head of a foreign asset management company to the post of vice president has been hailed by many as the sign of a new beginning for the industry association, which had been seen over the past years as a two-headed association, split between the interests of national and international players.

During his first public speech as president, Lombardo touched on the importance of promoting long term savings and making the positive performance of the Italian asset management industry sustainable.

“Last year we saw record inflows of €63bn. We now have to make sure that this trend is sustainable in future,” Lombardo said.

Touching on the EU initiatives to support SMEs across the continent, Lombardo added: “I believe mini-bonds for SMEs will become a new asset class and Italy has all the numbers to lead the way in this sector.”
Plenary session – Long term saving and mini-bonds

The international and certainly more European attitude of the Italian asset management industry was also emphasised during Salone’s opening session, when Steven Maijoor, chair of the European Securities and Markets Authority (Esma) and Christian Dargnat president of the European Fund and Asset Management Association (Efama), as well as CEO of BNP Paribas Asset Management joined local players to inaugurate the event.

During his speech, Maijoor stressed the importance of themes such as investor protection and highlighted some new concerns gaining ground in security regulators’ priorities.

While investor protection is not a theme that can be left aside in a growing environment for the asset management industry, Maijoor also highlighted that security regulators, who have been traditionally focused on re-establishing the safety, and therefore the investors’ trust in financial markets, are now increasingly focussing on stability instead.

“Spend more in the securities market and try to increase the level of non-bank lending,” Maijoor told the Salone audience.

Efama’s Dargnat warned the industry not to forget that asset management companies are in charge of savers’ money, “which is to say the money of other people,” he remarked.

“At present, the industry faces the highest challenge but has also the highest level of opportunities. Across Europe, less than 10% of people have their money invested in a fund, while in the US the percentage is around 90%. We therefore have a great opportunity of becoming the main funders of this potential industry,” he said.

Dargnat, however, also warned regulators of the necessity to stabilise the market by not applying too many rules.

“Ucits funds were established 25 years ago and during this time they have undergone something like six or seven reforms. That’s too much for the industry,” he stressed.

Bringing the audience’s attention to back to the event’s main streams, Assogestioni’s president Lombardo highlighted the importance of European long term investment funds to strengthening the culture of long term saving across the population.

“Long term investing is the most urgent topic our industry has to deal with at present. Inflow levels have been extremely positive in Italy in 2013 and I believe that lending to SMEs is an essential part of it. Spreading a culture of long term investing is also essential to another core issue for our asset managers: pension funds,” Lombardo said.

Assogestioni’s new president reminded his audience that there were currently some 26 initiatives across Italy to launch mini-bond funds. “We hope regulators won’t hit hard on SME lending,” he added.
The other panellists sitting on Salone del Risparmio’s opening session were

Tommaso Corcos, CEO of Eurizon Capital SGR; Santo Borsellino, CEO of Generali Investments Europe as well as both newly elected vice presidents of Assogestoni and Pietro Giuliani, CEO of Italy’s independent asset management company Azimut.

The managers agreed on the necessity of creating individual saving accounts in Italy as well as of reflecting on the importance of financial education among savers.

The promotori finanziari evolution

Another topic that was in the spotlight at the Salone, was that of the evolving figure of promotore finanziario – the rough equivalent of an independent financial adviser.

Featuring a rich panel including multiple associations covering different aspects of the promotori finanziari profession – such as Anasf and Assoreti – as well as managers of asset management companies from the US, the UK, France and the Netherlands, the discussion seemed to state the difficulty of harmonising the tax rules promotori finanziari are bound to abide by with that of other professionals in the industry.

The lack of a clear legislation that aligns promotori finanziari to other professional standards in terms of tax and professional conduct while respecting the nature of their work was also pointed out by the panel.

To give a feel of the situation on the ground when it comes to the role of financial advisers, Marco Barbaro, CEO of BNP Paribas Investment Partners; Simona Merzagora, country head Italy & Austria at ING Asset Management BV; Lorenzo Alfieri, Italy country head at JP Morgan Asset Management and Carlo Trabattoni, head of Retail for Europe at Schroders joined the conversation.

The government presence – Finance vice minister Enrico Morando
The last-minute announcement of the presence of Italy’s deputy minister of Economy and Finance Enrico Morando filled the gap left until the very last session by the Italian government at the event.
Although evoked several times during a number of sessions, mainly for calls to action, representatives of the Italian government did not attend the event.

Morando took the stage at the end of the Salone closing session to state his personal commitment to work on harmonising the tax system for the asset management industry and to carry on work on the future of pension funds and saving for retirement.

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