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Independent financial advisors have benefited from growing investor distrust toward the banks, according to the International Forum of the Convention of Independent Financial Advisors (CIFA).

David Bennett, chief executive of the Association of Private Client Investment Managers and Stockbrokers (APCIMS) in London, confirmed a 10% to 25% increase in assets under management among members.

“The clients are desperate for professionals who can protect them against large financial entities”, said Leong Sze Hian, president of the Society of Financial Service Professionals (FSP) in Singapore. Independents could double their market share from 15% to 30% within the next five years, noted Olivier Collombin, director at the private bank Lombard Odier in Geneva.

Excess overconfidence and a tendency of the political elites to remain blind to certain facts were among the factors that caused the crisis, the forum was told. According to Patrice Robineau, senior advisor to the executive secretary of the United Nations’ Economic Commission for Europe, “The warnings issued by the UNCTAD or the Financial Stability Forum have been ignored.”

For Adrian Blundell-Wignal, Deputy Director of the Directorate for Financial and Enterprise Affairs of the OECD, this crisis was mainly caused by a series of bad political decisions since the 1990s. He pointed to the dismantling in the U.S. of legislation inherited from the 1930’s crisis and bashed the Basel II Accord as “one of the greatest blunders in the history of regulation.”

The lack of transparency and a systemic information deficit in the financial sector were yet other driving forces of the crisis, said Philippe Dessertine, head of the Institute of High Finance in Paris.

A panel discussion addressed the need for proper education and reviewed the responsibilities of the investors and the financial professionals.

The panel discussion at the forum concluded that better regulation, rather than more regulation, was needed to restore financial order. The panel pointed to supposedly tighter controls over money laundering and terror financing, which it said have not proven effective.

“Money laundering today is easier than ever,” said Professor Xavier Raufer from the Department of Research on Contemporary Criminal Threats at the University of Paris, referring to the “paper cathedrals” built by governments which have proven totally ineffective in combating financial crime.

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Manulife named subadvisor to MD fund

MFC Global Investment Management has been selected as the new sub-advisor for the MD Dividend Income Fund.

“This important mandate reflects the confidence that was placed in MFC Global Investment Management’s strong investment management and servicing capabilities,” says J.F. Courville, president of MFC Global Investment. “I am proud that the members of our team were given this opportunity to express their collective talent and commitment to MD Funds and to the investors that will benefit from this.”

The MD Dividend Fund has a combined equity and fixed income mandate. It employs a team approach led by Alan Wicks, senior portfolio manager and head of the Toronto-based large cap value equity team. The fixed income portion of the fund will be managed by Terry Carr, managing director and head of Canadian fixed income.

The MD Dividend Fund’s investment objective is to maximize dividend income in a manner consistent with capital conservation. The fund invests in dividend producing common shares (including income trusts) as well as high quality preferred shares of Canadian corporations, bonds and short-term debt securities.

Launched in 1992, the fund has provided investors with a source of tax-efficient income for nearly two decades and according to J. Craig Maddock, CFA, assistant vice-president, investment management.

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RBC-AM pool seeks new subadvisor

RBC Asset Management announced today that it has begun a search to replace the sub-advisor for its RBC Private U.S. Value Equity Pool.

The New York based Boyar Asset Management will continue its role as sub-advisor on the pool until another sub-advisor is identified. RBC Asset Management will continue to provide investment management oversight for the pool to ensure a smooth transition.

(05/04/09)