Scotiabank, Sun Life form partnership for private investments

Scotiabank Global Wealth Management and Sun Life Capital Management are partnering to provide private investments to the bank’s wealth management clients.

Under the deal announced Tuesday, Scotiabank’s high-net-worth clients will get access to SLC Management’s private-market funds. SLC manages about $361 billion in assets (as of June 30). Its affiliate investment managers include private real estate firm BGO; private credit manager Crescent Capital; and InfraRed Capital Partners, a private infrastructure firm.

SLC, which is committing to invest $100 million of seed capital for future funding opportunities, will gain access to Scotia’s various wealth brands. Eugene Lundrigan, president of SLC Management Canada and head of the institutional business, said the firm was looking for a long-term strategic relationship rather than just a product partnership as SLC engages in the “missionary work” of increasing private asset allocation among retail investors.

“I don’t think you need to be a rocket scientist to figure out that you can’t really be successful in Canada without partnering with a bank,” Lundrigan said.

Scotia is looking to make private assets more available to its wealth clients, said Neal Kerr, head of Scotia Global Asset Management.

While clients of ScotiaMcLeod, Scotia Private Investment Counsel, MD Financial Management and Jarislowsky Fraser will be more likely to make direct allocations to private asset funds developed with SLC, mass-market clients may be able to get small private-asset allocations in managed portfolios, Kerr said.

Scotia’s immediate priority is making the investments available to Scotia clients, Kerr said, but the firm may eventually offer private assets under the Dynamic Funds brand for third-party distribution.

The partnership comes as asset managers make private assets available to retail investors, particularly the very wealthy. Firms including Purpose Investments, BMO Global Asset Management, Wealthsimple and CI Global Asset Management have released private-market funds this year targeting retail investors.

In recent years, asset managers have been partnering with or acquiring alternative firms to broaden their offering of private-market investments to clients. Some of those products are reserved for their own wealth clients, while others are made available to the broader market.

Mark Burgess

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Mark was the managing editor of Advisor.ca from 2017 to 2024.