A major shift in the Dutch retail investor market. Netherlands’ largest fund house Robeco decides to focus entirely on institutional and wholesale investors and, with pain in its heart, says goodbye to retail investors. With the takeover, Evi van Lanschot suddenly comes of age.
In one fell swoop, Evi, the retail arm of investment bank Van Lanschot Kempen, gains 125,000 new clients. That is a six-fold increase in the client base. Assets under management jump from 1.3 billion euros to six billion.
“Evi suddenly turns from a very beautiful daughter into an even more beautiful adult woman this way,” said Maarten Edixhoven, Van Lanschot Kempen’s chief executive officer, when speaking to Investment Officer. Evi’s brand and communications in the Dutch market is supported by a drawn character of a young lady.
Difficult decision
Robeco CEO Karin van Baardwijk makes it clear that the decision was not taken lightly. ”It’s a very difficult decision, and one you don’t take lightly either. It is indeed a very large customer base. And also a name that resonates in the market, associated with history, quality. So this grieves incredibly.”
Robeco is releasing 4.7 billion euro in managed private assets, money that Dutch private individuals have invested for decades through the Robeco funds. However, on Robeco’s total - until the takeover it was 201 billion euros - that is a pittance.
“If you are honest and look at the size of Dutch retail business in Robeco’s total assets under management, it is only 3 per cent,” Van Baardwijk said.
Retail assets are clearly no longer a core business for Robeco. With that, it is important to find ‘another home’ where it can grow and where it does return to being a core business. “This has been a very difficult decision that I also take with pain in my stomach, but I think, from a customer and employee perspective, this is a very nice transition.”
New office in Rotterdam
Robeco will say goodbye to some 60 employees. They will move into a new office in Rotterdam this summer, for a transition phase that will last at least until 2025.
For the integration of Robeco’s retail team, Van Lanschot Kempen is allocating between 8 million and 11 million euro. After a two-year integration period, the combination will break even in 2025 and will then be able to make a positive contribution to Van Lanschot Kempen’s net profit.
Robeco’s investment funds will remain part of the Evi van Lanschot platform. Some 60 employees of Robeco Retail Netherlands will transfer to Van Lanschot Kempen to help further grow the online investment proposition.
“We find it extremely important in this labour market to retain talent that also understands the market and knows the clients well,” said Edixhoven. ‘So that’s really where our focus lies. Our focus is to continue to grow by retaining colleagues and talent that comes over from Robeco. Hence why we are going to open that hub in Rotterdam.”
The Netherlands currently has about two million retail investors, according to regulator AFM. With a customer base of 150,000, Evi van Lanschot is then still not a huge player in the market. Edixhoven reveals that van Lanschot Kempen clearly wants to grow further.
Further growth through acquisitions
“We are already growing strongly organically and we also believe that, with the individualisation of the pension system, where you also see that self-employed people and the like have to invest more and more for later, that that is also a growth market in itself,” said Edixhoven. “Of course we have to make sure the integration goes well, also good for customers. In addition, we will also continue to look at other opportunities perhaps through acquisitions to continue to grow as well. But first we are going to make sure we have the focus on the integration.”
Robeco emphasises that its strategic focus will be on its core business in the Dutch and international wholesale and institutional markets. Earlier, Robeco stopped fiduciary management and private equity activities.
“Saying goodbye to our Dutch distribution channel does not mean Robeco loses its function for Dutch institutional clients, our pension funds, insurers,” Van Baardwijk said.