Alain Bastin (BIL Manage Invest): Continuous Crescendo
After a successful financial year 2019, how is BIL Manage Invest S.A (BMI) meeting the challenge of the health crisis? In this interview, CEO Alain Bastin looks back at increased substance, and then forward to the growth plans for this ambitious super ManCo.
How has BIL Manage Invest grown over the last 12 months?
2019 saw a 60% increase in assets under management (AuM), a jump of 2 billion euros. We ended the year at €5.5 billion, and the €6 billion will be reached before 2020-year end. 65% of our assets are in private equity and real estate, our speciality. BMI is enjoying growth generated externally, but also organically through our existing clients, several of whom have more than 1 billion in assets. Last year also saw us significantly strengthen our governance model, with growth in the number of our independent directors, and strengthening our internal substance to reach 23 employees. This consolidation enabled us to sign a number of major real estate deal in the French and Luxembourg markets, including the contract for Phase II of the Cloche d'Or in 2019. Thanks to strengthened synergies with our shareholder Legend Holdings, we have implemented unique products which has opened up the Chinese private equity market for our clients. BIL opened an office in Beijing in 2019, and has recently acquired an entity in Hong Kong. Despite the current crisis, this will enable us to expand our Asian network substantially, with a view to developing significant ties in both directions.
"It is important to distinguish the 'traditional' challenges from the difficulties created by the coronavirus. We remain confident in both cases"
How are you adapting to changed customer requirements?
BMI has a comprehensive model. On the one hand, we work for the group's clients who are focused on wealth management, and on the other, we work with institutional clients and our own network. We therefore have a relatively wide and varied client base, and we benefit from this diversity. Our ManCo is part of a banking group supervised by the European regulator. This reinforces our reputation as a serious player. In addition, the significant increase in substance strengthens our model. We assist entrepreneurs with structuring support, to which we can add portfolio management services. They benefit from the full range of BIL Group services: financing, classic banking products, asset management, brokerage, ManCo, custodian banking and administration. This model is a unique system, allowing entrepreneurs to structure their activities, while delegating entire regulatory and administrative functions.
What challenges and opportunities do you see in the medium term?
As far as the challenges are concerned, it is necessary to distinguish the 'traditional' ones – notably margins under pressure and growing regulation – from the difficulties created by the Covid 19 crisis. Concerning the former, we take these constraints and make them into opportunities thanks to our position within the group. For example, we have just integrated internally BIL funds which were previously under third-party management. This allows the BIL management team to work in close collaboration with BMI, and to continue to develop synergies and processes, as well as easily extending the group’s range of funds through shared, fast-growing expertise. Furthermore, our set up enables us to target Asian players seeking to invest in Europe though an European authorized agent like us. BMI operates as a third-party ManCo within a banking group which deploys an open architecture philosophy. Our clients therefore benefit from all the advantages of independence offered by an external company, while at the same time benefiting from a first-rate shareholder which gives the necessary comfort to promoters and other players regarding these activities. We are one of the few third-party fund ManCos which is also part of a banking group, able to assume portfolio management mandates in the same way as would an independent company.
Regarding the coronavirus crisis, the recent events will influence our activities in many ways, as 65% of our assets under management are in PE/RE, i.e. the real economy. It is still too early to judge the real impact on valuations, but it is certain that several sectors will suffer while others will emerge stronger than before. We will be able to measure the impact in a few months, but we remain confident about the resilience of these activities given the quality of our clients and the projects we work with.