Print this article

A Look at Some of Australia’s Most Influential Wealth Managers

Lachlan Colquhoun

1 February 2007

As a supplement to WealthBriefing’s hugely popular annual Faces to Watch series, we’ve decided to add a regional focus. To kick start the regional offering, we take a look at some of the movers and shakers in the world of Australian wealth management. Jeremy Nestel, - Head of Citigroup Private Banking for Australia and New Zealand Private banking is a relatively new phenomenon in Australia, but Citibank has shown that playing to the top end of town can yield spectacular results. Under Mr Nestel, Citigroup – which launched private banking in Australia five years ago - targets the market segment with over A$50 million in assets, which it estimates consists of 1,000 people or families in Australia, and perhaps another 200 in New Zealand. Before Citigroup’s offering arrived in the antipods, these people were looking internationally for their opportunities, or were forced to deal with multiple departments of single banks or with multiple banks. Now, Citigroup offers the super-rich one single institution which it claims can service all their banking and investment needs. And it seems the target market is listening. Mr Nestel claims the private bank has grown at over 50 per cent per annum since inception, and that it currently services families with an aggregated net worth of A$100 billion, clients at the very top of the Australasian wealth pyramid. Warwick Negus – Chief Executive Colonial First State Global Asset Management Warwick Negus went from a major global bank to a boutique start up which was so successful that one of Australia’s largest bank took a stake in it, and then made him chief executive of the country’s largest funds management operations. Mr Negus left Goldman Sachs to co-found boutique fund manager 452 Capital in 2002 – a company named after cricketer Sir Donald Bradman’s record breaking batting innings in the 1920s, then a world record. By 2005, 452 Capital had more than exceeded its target of A$3 billion in inflows and the Commonwealth Bank, which owns Australia’s largest fund manager Colonial First State, was knocking on the door. The result was that the CBA took a 30 per cent stake in 452 Capital and then catapulted Mr Negus to head the revamped Colonial First State Global Asset Management, which boasts around A$100 billion under management. Mr Negus ruffled some feathers after his appointment and his restructuring prompted a rash of resignations across the company, but under his stewardship Colonial First State is on track to become not just a fund manager growing in new markets such as China, but a player in global infrastructure deals. Rob Coombe – Chief Executive BT Financial Group BT was once an iconic name in Australian wealth management, and under the leadership of Rob Coombe it is regaining some of its old lustre. Before it was dismembered as part of the global BT carve-up in 1999 and eventually sold to Westpac Bank, BT was the premier wealth management brand in Australia. It was famous for its results, and also famous for tipping the 1987 sharemarket crash and getting out with its investors still wearing their shirts. After 1999, things started to go dreadfully wrong, but a recent renaissance has coincided with the appointment of Mr Coombe in 2005. Now, BT is winning accolades once more, grabbing a swathe of recent industry awards and – more importantly – delivering to its investors. Its investment in technology is also paying off as its BT Wrap platform is one of the most popular investment vehicles for financial advisors. The flagship Australian share fund has returned around 25 per cent a year for the past three years, inflows are positive again and total funds under administration were up 17 per cent last year to A$40 billion. Cynics might say Mr Coombe has been in the right place at the right time. Others say his cool head and investment smarts have driven the resurgence. Steve Tucker – Chief Executive Officer MLC In the late nineties and the early part of this decade the Big Four Australian banks spent a fortune on fund mangers, life insurers and wealth managers. MLC, a household name in all of these areas was picked up by the National Australia Bank but has struggled to both repay the investment and find a niche in the NAB empire in areas such as cross-selling. Steve Tucker, however, has made a significant different since he was appointed chief executive of MLC in October 2004. Now, MLC – which with around $90 billion of assets under adminstration is the country’s second largest funds operation – is much more integrated with the NAB and the two brands are starting to reap the benefits. This may be because Mr Tucker has a long history in the NAB, which he joined back in 1988. One of his main achievements so far, apart from getting MLC closer to its NAB parent, has been his leading role in remodelling the financial planning profession in Australia. MLC has a large distribution network through financial planners who are part of the Godfrey Pembroke brand, and Mr Tucker has been instrumental in moving away from the older commission-based model, which many say is riddled with conflicts of interest, to a new model based on fee for service. This positions MLC-linked advisors to not just sell product as they did in the past, but operate in a new model where holistic advice is just as important to the customer as the products they invest in. Andrew Mohl – Managing Director and Chief Executive, AMP AMP is one of the oldest and most prestigious names in the Australian financial sector but perhaps only one man saved it from oblivion in the early part of this decade, and that was the chief executive Andrew Mohl. Mr Mohl inherited the poisoned chalice of AMP leadership at perhaps the worst possible time in the group’s history, the dark days of October 2002 when the company was reeling from its overly ambitious attempt to become a major player in the UK. Mr Mohl came to AMP in 1996 after working at ANZ and also at the Reserve Bank of Australia as Deputy Head of Research, and he needed all of that intellectual rigour to turn around the company. After huge writedowns and a A$5.5 billion full year loss in 2003, AMP under Mr Mohl has rebounded and survived, selling off long-time assets such as Henderson fund management in the UK and refocussing on its core business in Australia. At one point, AMP could have been history. Now, after several years of pain, it is re-established and has around A$100 million in funds under management and is a major player once more.