Investment Officer

Dividend payments fell by a record 22% in the second quarter, hitting their lowest level in eight years, according to the latest Global Dividend Index from Janus Henderson Investors. Europe and the UK were the worst affected regions.

Back in May, the asset manager had already predicted a decline in dividend payments between 15% and 35%. Global dividend fell by $108.1 billion (€91.3 billion) to $382.2 billion in the second quarter.

The investment industry’s high expectations of robo advice and the use of blockchain technology have not yet been met. For now, robo advisers have failed to make a decisive breakthrough, according to research by the CFA Institute among more than 250 of its member organisations.

A substantial majority of these appear yet not to use big data analysis, machine learning or artificial intelligence in risk management, compliance or the investment process.

The European Commission will relax a number of financial market rules to enable stock exchanges to play a greater role in the recovery from the coronavirus crisis.

Private banks in Europe saw their profits decline in 2019, for the second year in a row, according to a study by McKinsey. Profitability is under pressure due to a combination of rising costs and lack of client growth.

According to the management consultancy, the study shows that private banks in Europe are confronted with structurally weak profit dynamics, growing dissatisfaction among clients and significant operational problems due to working from home.

The Canadian Imperial Bank of Commerce (CIBC) has moved its European headquarters from London to Luxembourg following Brexit.

Net corporate borrowing around the world will increase by $1 trillion in 2020 as the coronavirus pandemic is further increasing companies’ need for debt financing, according to research by Janus Henderson Investors.

Global corporate debt had already surged to a record $8.3 trillion in 2019 before start of the pandemic, an increase of 8.1% year-on-year. Company resources were depleted by debt-financed acquisitions, large share buybacks, record dividends, and the chilling effect on profits caused by trade tensions and a global economic slowdown.

As a result of the Covid-19 crisis, inflation expectations have fallen even more. From already very low levels. When, if ever, will inflation ever rise again?

Peter De Coensel, CIO Fixed Income at Degroof Petercam Asset Management (DPAM) and fund manager Sam Vereecke tried to answer this question, which has been haunting investors for the past 40 years, in a webinar.

The Trump administration has proposed a bill prohibiting pension funds from incorporating ESG criteria into their portfolios.

The Department of Labor’s proposal instructs pension funds to choose investments ‘based solely on financial considerations’. Labor Secretary Eugene Scalia wrote in an op-ed in the Wall Street Journal that standards for ESG investing “are often unclear and sometimes contradictory” and often try to promote a social or political outcome.

Agreement on the European coronavirus recovery fund could be a “gamechanger” for the European Union, according to Vincent Juvyns (photo). It’s his main reason to be a bit more positive about European stocks again.

The Global Market Strategist at JP Morgan Asset Management is “very impressed” with the European approach to tackle the impact of the virus. Although a final agreement has yet to be reached, the fact that Germany is taking the lead in this strengthens his confidence this will happen soon.

Most institutional investors expect there to be minimal impact on their business from the coronavirus crisis, even though three in ten say their daily investment-related operations were disrupted by the volatility. These are the key findings of State Street’s ‘Volatility Study 2020’ – seen exclusively by investmentofficer.lu – which surveyed 640 mainly insurance and pension funds in April.