Neuberger Berman announced the formation of its first dedicated emerging markets debt team, consisting of 22 investment professionals from ING Investment Management, the company announced Wednesday.
The group will be led by Rob Drijkoningen and Gorky Urquieta, who joined the firm earlier this year. They will report to Brad Tank, chief investment officer of fixed income. Nineteen members of the team, including Messrs. Drijkoningen and Urquieta, already have started at Neuberger Berman; the last three will join later this month.
George Walker, Neuberger Berman CEO, said the firm has been looking to build emerging markets debt capabilities for some time.
“Hiring 22 people at once is a big statement for us,” Mr. Walker said in a telephone interview. “We have extraordinary confidence in the individuals hired. It's an important asset class. … We were committed to doing it, but only if we could do it right.”
The team, all of whom were recruited individually, consists of 12 portfolio managers, six credit analysts and four economists and strategists operating from offices in Atlanta, The Hague and Singapore.
The five lead portfolio managers are Bart van der Made, hard currency; Raoul Luttik, local currency; Jennifer Gorgoll and Nish Popat, corporate bonds; and Prashant Singh, Asia local bonds.
“We had some expertise in the area, but nothing like 22 professionals who eat, sleep and focus on EMD,” Mr. Walker said.
The first strategies launched will be in hard currency, local currency and corporate credit. The firm plans to have a “whole suite of strategies,” including dedicated Asian debt strategies, Mr. Urquieta said in an interview. The first launch will be in June.
Mr. Urquieta said there have been significant inflows into emerging markets debt in the past five years, but it is still only a fraction of the opportunity available. Global portfolios typically have a 2% to 5% allocation to emerging markets debt, which is completely “out of whack” with where GDP in emerging economies will be in the next five to 10 years, he added.
Neuberger Berman has $216 billion in assets under management, including $97 billion in fixed-income assets.
Despite the mass exodus of employees, ING will continue to offer a full range of emerging markets debt strategies and has already taken steps to rebuild its team, according to a statement from Hans Stoter, chief investment officer.
Spokesman Karl Hanuska said the emerging markets debt team will likely be a little smaller than before. There are currently 25 people involved with the strategies, down from about 30.
Sylvain de Ruijter, head of core fixed income, was named acting head of emerging markets debt to replace Messrs. Drijkoningen and Urquieta. ING promoted several employees internally to lead portfolio manager and hired Marco Ruijer as lead portfolio manager for hard currency in April. Mr. Ruijer was previously senior fund manager at Dutch manager MN.
“The departures were a temporary setback in growing our EMD business,” Mr. Stoter said in the statement. “We are confident that the reinvigorated team will continue generating attractive investment returns for clients and grow our AUM in this asset class.”
