It says something that France’s Amundi has chosen an exchange traded funds head as its chief executive. Asset gathering counts most for this €1.7tn manager. Valérie Baudson’s unit has collected plenty of clients with low-fee ETFs, paving her way to the top job.
She will replace Yves Perrier, who has presided over a golden period for Amundi since its listing in November 2015. A slight softening in profitability over the years suggests that growth will be a strong priority.
Amundi’s role model looks more like BlackRock — which covers the waterfront of products — than UBS, which targets higher margin wealth management. Passive strategies within ETFs, a forte of BlackRock, put pressure on fees. Cost to income rose by 80 basis points to 51.7 per cent last year. Baudson will need to deal with that.
She will have an eye on fund performance. It shows early signs of slipping. In Wednesday’s full-year results, Amundi revealed that 65 per cent of its funds ranked in the top two quartiles over one year, down from three-quarters over three and five years.
Nevertheless, Perrier has left Baudson in a good position. Amundi’s total share price return — up 77 per cent — has outpaced its sector, and trebled that of MSCI Europe, since the IPO. It must be painful for Frédéric Oudéa, the embattled chief executive of Société Générale, to watch. He sold the bank’s stake before the listing, a move majority holder Crédit Agricole avoided.
The pace of AUM growth slowed in 2020. A small mercy was that net inflows of €45bn contributed most. Amundi beat fourth-quarter forecasts thanks to fat, unreliable performance fees.
The worry is that Amundi, for all its critical mass, is stalling relative to rivals. Smaller German peer DWS has closed most of its previous valuation discount.
Baudson may not have to worry about the kind of predators plaguing US fund management these days, given its majority backer. But surging markets make it easier for Amundi’s rivals to catch up. Her job is to re-establish Amundi’s credentials as Europe’s standout fund management success story.
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