Hermes swipes from Fidelity and pension fund for Brexit

Two women will lead £36bn manager’s new Irish business

BT Pension Scheme sells Hermes stake to US giant

Hermes Investment Management has nabbed from Fidelity International and a US pension scheme as it becomes the latest asset manager establishing an office in Ireland as a post-Brexit base for European Union clients.

The £36bn manager has revealed it received authorisation in December from the Central Bank of Ireland to establish Hermes Fund Managers Ireland – a Ucits management company and alternative fund manager. It also has permission to provide individual portfolio management services.

Hermes announced Fidelity International veteran Carol Mahon will become head of Ireland with responsibility for oversight, development and management of Hermes Fund Managers Ireland and any branches in the European Economic Area. Aoifinn Devitt will become head of investment for Ireland and Hermes is currently recruiting a head of compliance.

Operations will commence by 29 March 2019, the due date for the UK’s exit from the EU, with six staff due to be in place by that date. By the end of 2019, Hermes expects the number of staff in Dublin to be in the range of eight to 10.

Hermes joins other asset managers in Dublin

This month, Royal London announced it would create 20 jobs through a new Dublin office, while Legg Mason appointed Penny Kyle in December to lead a six-strong team in the Irish capital. They follow in the footsteps of Aberdeen Standard Investments, Legal & General Investment Management and others who have already established Ireland as a post-Brexit base. Richard Buxton has confirmed Merian Global Investors is establishing an Irish management company.

Portfolio Adviser also revealed last week that Crux Asset Management would be abandoning a feeder fund it established after the referendum and replacing it with a directly-invested Luxembourg-domiciled Ucits as its Brexit planning turned to “worst case” scenario.

Opportunity to expand in Europe

Hermes chief executive Saker Nusseibeh said the company had been preparing for a “hard Brexit” since the UK vote to leave the European Union in June 2016.

“We recognised early on that we had to make appropriate contingency plans in the absence of certainty, in order to ensure, to the extent possible, that we remain able to manage our clients’ assets in line with their expectations of us.”

The new company steps up Hermes’ existing presence in Ireland, Nusseibeh said.

“Hermes has 10 years of investment management activities and service provider relationships in Ireland, with our Ucits range domiciled there. Given this, and our European business growth, we have taken the Brexit opportunity to bolster our presence in Ireland with the establishment of a management company to lead the management of Hermes’ European product offering and facilitate distribution to European clients.”

The Irish company is simultaneously a chance for Hermes to expand its footprint in Europe, he said. Hermes already has branches in Germany and Denmark connected to the UK entity, but they will transition to become branches of Hermes Fund Managers Ireland.

More roles to be filled

Mahon joins from Fidelity International where she had been CEO of its life insurance business based in Ireland. She had been with the asset manager for 17 years.

She will work closely with sales, marketing, product, business development management and compliance and report into Harriet Steel, head of business development.

Devitt was previously CIO at the $2.6bn Chicago Policemen’s Annuity and Benefit Fund. She will be responsible for the development and delivery of investment management oversight processes, including collective investment schemes and managed client accounts. She will report to Eoin Murray, head of investment.

Hermes said it was recruiting for additional roles at its Irish base, including a head of compliance.

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