2. Contents
3 Introduction to Banque Heritage
9 Focus on EAM services
13 Macro views
14 Socially Responsible Investments 2.0
22 TerraEquitas SRI Allocator
28 Appendice
32 Disclaimer
27 Contacts
Investment Services July 202
3. July 20Investment Services3
Banque Heritage in a nutshell
Active
industry
consolidator
Family
owned
From 5 to
3’000 clients
230
employees
170 years of
merchant
history
Founded in
1986 as a
family office
Banking
license in
2004
CHF 4.9bn
AuM
4. July 20Investment Services4
Timeline
Banque Heritage is a young, yet active financial institution
• Strong growth, both organic and through acquisitions
• Truly Swiss footprint, with offices in Geneva, Zurich and Sion
• Always looking for new and innovative partnerships
5. July 20Investment Services5
Ownership
Banque Heritage is controlled by the Esteve
Family who is also the primary shareholder of
ECOM Agroindustrial:
• Majority owner
• No dividend distribution policy
• Stable and strong supporter of expansion
plans
76%
17%
7%
Ownership Structure
Esteve Family
Private & Management
Treasury
ECOM: A leading global commodity merchant
7. July 20Investment Services7
A full range of services
Private Banking
Custody
E-banking
Card solutions
Safekeeping
Trading access
FX trading platform
Dedicated RMs
Asset Management
Advisory
Discretionary management
Macro research
Equity / Bond lists
In-house specialty products
Open architecture
Structured products
Asset Services
Transaction services
Global custody
Credit facilities
Lombard loans
Succession & Estate planning
Manager on-boarding
Tax advice
8. July 20Investment Services8
Our edge
Flat
structure
. Access to senior management
. Rapid decision making process
. Low turnover ensures long-lasting quality
relationships
Aligned
interests
. Shareholders invest alongside our
clients
. Family office roots ensure the perennial
nature of our institution
. Our entrepreneurial mindset allows us
to seize opportunities, to the benefit of
our clients
AM
offering
. Full asset management and investment services
offering
. Access to macro research and investment ideas
out of the box
. Regulatory support for MIFID II / LSFIN
Reactivit
y
. 60% of the bank’s AuM come from
countries with high economic growth
.Used to fast changing environments
. We identify upcoming problems and
seek solutions proactively
9. July 20Investment Services9
EAM services, at the heart of our business
33% of our
AuM and 25%
of our revenues
Dedicated team
of 12
60 active
counterparties
Flexible
approach
Full investment
services
Chief Executive
Officer
Marcos Esteve
Head of PB &
Investment
Services
François Oesch
Head EAM &
Zurich Team
Martin Brenner
Zurich
4 RMs & 1
Assistant
Head EAM
Geneva
Luciano Ciriolo
Geneva
3 RMs and 2
Assistants
10. July 20Investment Services10
Partnership with external asset managers
Acquisition Relationship
Management
Risk
Assessment /
Client
Profiling
Advisory
Discretionary
Management
Client
Reporting
Implementation
Execution &
Support
Custody
Services
Producer Internalized Delegated to Banque Heritage
External Financial
Advisor
Internalized Delegated to Banque Heritage
External Asset
Manager
Internalized Delegated to Banque Heritage
A flexible and bespoke framework that suits your needs
Our value-added services include:
• Stable and senior RM team
• Multicultural, multilingual
• Extras: private placements, after hour trading, etc.
• Deep knowledge of both onshore & offshore markets
11. Investment
Services
Private
Banking
External Asset
Managers
Asset
Services
The Banque Heritage Investment Services
department is a full-fledged asset management
platform working exclusively to the benefit of
Banque Heritage’s various lines of business.
Investment Services are fully integrated across
our institution’s entire value chain, offering
among others:
• Macro & strategy research
• Direct investment advisory
• Fund advisory
• Bespoke products
• Discretionary management services
Investment services
Investment Services July 2011
12. Investment services team
Investment Services July 2012
Specialists
Implementation&
Advisory
Jean-Christophe Rochat,
CIIA
Advisory
Onur Von Burg, CIIA
Discretionary Portfolio
Management / Advisory
Toni Apostoloski
Discretionary Portfolio
Management / Investment
Proposals
Jean-Christophe Rochat,
CIIA
Team Head
Jean-Charles
Crouzet
Strategy
Markus Koch,
CFA
Fixed Income
Stéphane
Trezzini
European
Equities
Michel
Mazenauer,
CAIA
US Equities &
Alternatives
Mikaël
Safrana, CIIA
Funds, Private
Markets & Alt.
UCITS
13. July 20Investment Services13
Macro views – Global economic environment
Our Scenario
The peak of globalisation is probably behind us.
The rising risk of the US/China trade conflict has been
very impactful on financial market volatility.
This trade war seems to matter because it happens in a
context of policy tightening and a softer global economy.
Despite a resilient US economy, the rest of the world has
entered a soft patch: Europe, Japan and China.
Corporate profits and large share buy-backs are clearly
supporting risk assets.
As a result, the positioning of our portfolio has slightly
changed over the past month as we have reduced our
equity allocation to U/W and we have decided to increase
the duration of our sovereign bond investments back to
neutral and take our commodity exposure to a slight
overweight.
Tailwinds
Large central banks’ balance sheets
Buoyant investors’ sentiment
Strong earnings momentum globally
Headwinds
Synchronised normalisation of monetary policies on a
global scale
Trade wars & (geo)political risks
Asset valuations are stretched
Things to monitor
- - Accelerating inflation in DM countries
UW OW
Equity
Fixed Income
Alternative Investments
UW OW
UW OW
Commodities
UW OW
Cash
UW OW
14. Current Tailwinds
Central Banks Balance Sheets, Earnings Growth & Corporate Buy-backs
Source: Banque Heritage, Bloomberg14
Central banks are still providing a non-negligible tailwind to the markets. $22.6 trillion total assets, $3 trillion over past year
Trump’s tax reform and spending bills favour equity buy-backs and improve corporate earnings (+18% expected for Q1)
S&P companies are expected to spend $800bil in stock buy-backs & another $500bil in dividend. Total $1.3 trillion,. a +23%
increase over last year
A weak US Dollar is also helping companies generating a good share of their sales abroad
July 20
15. Current Tailwinds
A Resilient US Economic Backdrop
Source: Banque Heritage, Bloomberg15
Macroeconomic indicators still solid in the US:
Housing
Job market
Freight volumes (+12% YoY)
Consumer sentiment
Second longest economic cycle supported by strong sentiment post Trump election. Tax reform and unfunded spending
revived the cycle’s strength
Main question remains: have we reached the end of the current economic cycle?
Small Business Sentiment (Blue) vs.
U. of Michigan Sentiment
July 20
16. Current Headwinds
From 2012 to 2016, for every rate hike, global central banks implemented 3 rate cuts. Since 2016, for every cut, there is 1.75
rate hike
The chart below shows central banks target rates for the Fed, ECB, BoE and BoJ. The GDP-weighed five year change in target
rates turned positive in September 2017.
The bottom right chart highlights the fact that the correlation between financial stress and the average number of rate hikes
expected by the fed, ECB, BoE and BoC is no longer negative.
We are transitioning from a global synchronised QE into a global synchronised QT
Synchronised Interest Rates Normalisation,
Source: Bianco Research16 July 20
17. Current Headwinds
Absolute and relative macroeconomic data weaker around the global (except the US) as shown below
Europe has clearly decelerated at quite a fast pace. Slowdown led by Germany (impact from trade war and a strong €)
but also France
Strong Yen is starting to bite into Japan’s macro backdrop too. Domestic scandal involving PM Abe could slow reforms
But China shows growing signs of momentum loss: decreasing loan growth, decreasing IP and fixed assets
investments.
Shift from an economy based on investments to one based on consumption still current. Expect lower Chinese growth
level going
Global Slow Down Led By Europe and China
Source: Bianco Research, Bloomberg, Heritage17 July 20
18. Things to Monitor
The chart below highlights the fact that inflation’s momentum outside the US has slowed back to one-year averages after a very
concerted period of growth from October 2016 through March 2017.
Wage Inflation gauges in the US are still trending up but are lagging the unemployment rate, the NFIB small business hiring
plans and the output gap.
History shows that wages have a 1-year lag with the unemployment rate before they rise (bottom right chart)
The weaker US Dollar acts as an inflation accelerator
Fed members are slowly becoming more hawkish. A gap opens between Fed’s projections and the market’s expectations.
Is Inflation on the Verge of Accelerating? Mounting Geopolitical Tensions?
Source: Bianco Research, GaveKal18 July 20
19. Risk Environment: Uncertainties Building
Long-Term Tactical Matrix: The Goldilocks Scenario is Clearly At risk
Growth
Expensive
Cheap
Contracting Expanding
NEGATIVE NEUTRAL POSITIVE
CAUTION
WARRANTED
CONFIDENCE
WARRANTED
Valuations
Stock markets’ volatility remains elevated but bonds and
currencies volatilities subdued.
Investors sentiment is diminishing but stock market goes higher.
Feels like it is climbing a wall of worries. Earnings season kick off
is to blame for that as traders are positioning from the long side.
Rebound done on low volumes for now. Caution still required.
The risk model below in grey is the aggregation of all asset class
volatilities.
Source: Banque Heritage, Bloomberg19 July 20
20. July 20Investment Services20
Asset Allocation
U/W EQUITIES
o U/W US
• O/W Financials, Energy
• U/W Telecom, Real Estate, Utilities
o U/W Europe
• O/W Financials, Energy, IT
• U/W Utilities
U/W FIXED INCOME
o U/W Sovereign Bonds
• Neutral Duration
o U/W Credit
O/W Alternatives
o O/W Global Macro
o O/W Relative Value
O/W Commodities
o O/W Precious Metals
Currencies
o O/W Yen
o U/W CHF vs. EUR
o Neutral USD
UW OW
Equity
Fixed Income
Alternative Investments
UW OW
UW OW
Commodities
UW OW
Cash
UW OW
21. TerraEquitas
July 20Investment Services21
Prise de conscience
Quelques dates importantes
Investissements socialement responsables
Notre mission
Le produit
Les investisseurs
Engagement auprès des ONG de développement
22. July 20Investment Services22
Prise de conscience
• L’explosion démographique que vit
actuellement l’Humanité rend évidente la
nécessité de prendre en charge le devenir de
notre nombre qui, d’après les estimations de
l’ONU, devrait dépasser 9 milliards d’âmes d’ici
2050.
• Si tous les habitants de la terre adoptaient le
mode de vie Suisse, il faudrait 2.8 planètes pour
satisfaire les besoins de l’humanité (WWF,
rapport planète vivante 2014).
• Nous consommons plus que nous ne
pouvons produire !
• A long terme, cela provoquera un recul de la
biodiversité entraînant raréfaction des ressources
et amenant inévitablement faim, instabilité et
conflits armés.
• Nous devons rechercher un nouvel équilibre
afin d’assurer une meilleure existence pour les
générations futures.
• C’est cela notre mission !
0
1
2
3
4
5
6
7
8
9
10
19501960197019801990200020102020203020402050
World Population: 1950-2050
Source: U.S. Census Bureau, International Data Base, July 2015
23. July 20Investment Services23
Quelques dates importantes
1976 : Catastrophe de Seveso
1984 : Catastrophe de Bhopal
1986 : Catastrophe de Tchernobyl
1989 : Marée noire de Exxon Valdez
1999 : Marée noire d’Erika
2000 : Naufrage du Levoli Sun
2001 : Explosion de AZF de Toulouse
2002 : Marée noire du pétrolier Prestige
2006 : Affaire du Pétrolier Probo Koala
2010 : Explosion d’une plateforme BP en Louisiane
2011 : Accident nucléaire de Fukushima
24. July 20Investment Services24
Investissement socialement responsable
• On parle d’investissement éthique, responsable, social,
communautaire, durable mais plus communément d’investissement
socialement responsable (ISR)
• Il intègre les éléments non strictement financiers dans l’allocation
d’actifs et essaie d’atteindre un certain niveau de performances mais
pas à n’importe quel prix et de réconcilier éthique et finance.
• La Suisse a été un pionnier en ce qui concerne l’intégration du risque
environnemental, qu’il s’agisse de critères d’exclusion, de meilleures
sociétés ou environnementaux, sociaux et de bonne gouvernance.
• Deux questions se sont posées :
• Les bénéfices à long terme d'une sélection ISR compensent ils le risque de
concentration dans l’univers d’investissement ?
• S’agit il d’un phénomène de niche ou y a-t-il un véritable engouement pour ce type
d’investissement ?
25. July 20Investment Services25
Mission
• Il s’agit de mieux répartir les richesses et de réduire les inégalités
• Il s’agit d’aider l’ensemble des êtres humains sur la planète sans aucune
discrimination à se développer et obtenir les moyens économiques
nécessaires à une meilleure qualité de vie.
• Il s’agit, au delà des critères d’investissements ISR, définissant un cadre
de sélection de titres et une performance pour les investisseurs,
De partage
Pour cela, des Organisations non Gouvernementales (ONG) ou des
associations ayant les projets de développement les plus prometteurs,
recevront une partie des frais de fonctionnement du produit.
26. Produit - TerraEquitas SRI Asset Allocator
Nous avons créé un produit financier unique permettant d’associer performance pour les
investisseurs et aide au développement économique par le biais des ONG.
Disposer de nos richesses est une chance. Nous voulons aider l’ensemble des êtres humains,
sans aucune discrimination, à se développer et à obtenir les moyens économiques nécessaires
à une meilleure qualité de vie.
Dans ce but, nous lançons un produit d’allocation d’actifs à caractère socialement
responsable de la plus haute qualité, dont les critères d’investissement sont conformes aux 17
principes du pacte mondial des nations unies. Il s’agit de réconcilier la finance avec l’individu
et ses véritables aspirations. On peut les résumer ainsi:
Les investisseurs privés et institutionnels qui investissent dans le fonds soutiennent les projets
de développement d’une fédération d’ONG par le versement d’une partie des frais de
fonctionnement du fonds à ces ONG. Celles-ci sont sollicitées à investir leurs liquidités dans le
fonds.
Paix, justice,
droits humains
Santé Education
Infrastructures
& Activités
Energies
renouvelables
Habitat
July 20Investment Services26
28. Engagement auprès des ONG de développements
Aide
octroyée
aux grandes
comme aux
petites ONG
Diversificati
on des
projets afin
de
maximiser
l’impact
Rapport et
suivi des
projets
Allocation
dynamique
année
après
année
Sélection
rigoureuse
des ONG
July 20Investment Services28
Les ONG peuvent parfois être soutenues par la DDC ou être choisies avec rigueur parmi celles qui ont :
• Les projets les plus prometteurs
• Un rapport favorable entre les frais de fonctionnement et ceux pour soutenir les projets
29. OBJECTIF
Offrir un produit d’allocation d’actifs global, balancé et diversifié, dans le cadre d’une
gestion socialement responsable
TYPE DE GESTION
Horizon à moyen / long terme visant à générer un niveau modéré de revenus annuels.
L’appréciation en capital est une composante clé du rendement total du portefeuille.
FRAIS DES GESTION 1.40% + 0.20% (reversé aux ONGs)
DEVISE DE REFERENCE EUR – disponible en CHF hedgé
INVESTISSEMENTS
AUTORISES
Obligations d’états
Obligations d’entreprises Investment Grade & HY
Actions européennes & américaines
Actions des pays émergents
Immobilier liquide
EMETTEUR Exane
CONSEIL STRATEGIQUE Bluecap SA
REGLES
ADDITIONNELLES
Chaque sous-jacent doit posséder une notation ISR. Le portefeuille global doit afficher
un score ISR de haute qualité
Allocation maximum par position: 15%
Aperçu du produit
July 20Investment Services29
30. Une gestion robuste et dynamique
Philosophie d’investissement
Une gestion prudente et
raisonnée:
- Un contrôle constant des
risques
- Une approche basée sur la
préservation du capital et la
puissance des intérêts
composés
- De fortes convictions et
l’adossement à des expertises
externes de renom
Allocation stratégique
Revue annuelle de nos
différents scénarios et
allocation de référence sur la
période:
- Eléments géopolitiques
- Tendances macro-
économiques
- Valorisations long terme
- Caractéristiques propres à
chaque classe d’actifs
Allocation Tactique
Revue mensuelle et
positionnement tactique:
- Analyse technique
- Valorisations court terme
- Momentum
- Valeur relative
- Opportunités d’arbitrage
Implémentatio
n Portefeuille
- Sélection bottom-up sur
base financière et extra
financière
- Pondérations
- Revues régulières de
métriques financières:
alpha, beta, sharpe,
upside/downside capture,
etc.
- Ajustements
opportunistes
July 20Investment Services30
31. Une sélection de fonds « best in class »
• 70’000+ fonds
• Filtre quantitatif (taille,
historique, juridiction, etc.)
• Analyse qualitative
Base de données Morningstar
• 355 fonds
• Organisme reconnu de notation ISR
• Fonds doit être présent dans leur liste
• Si pas présent ou performance
financière trop faible, sélection sur base
du 2e filtre
Label ISR Novethic
• Sélection de fonds notés au moins «above
average» selon la méthodologie de classement
Morningstar
• Notation moyenne du portefeuille >= «above
average»
2e Filtre ISR
• Construction du portefeuille
• Poids établis sur la base de l’allocation d’actifs
8-12
Positions
July 20Investment Services31
33. July 20Investment Services33
Performance
Performance since launch (as of 12.04.2018) : -2.28%
Annualized volatility: 5.34%
• In line with Euro Stoxx 50 (-2.17%)
• Above SIX SMI in EUR (-10.43%)
• Below Barclays Pan European Aggregate 5-7 YR
(0.3%)
34. Une équipe de spécialistes
Eric Serra, Bluecap SA
Master en gestion internationale, HEC Genève (mémoire
sur les ISR en Suisse)
Actif depuis les années 80 (Crédit Suisse, Banca Monte
dei Paschi, Bank Von Erst)
Indépendant depuis 2003, Président de la commission
d’éthique des Conseils en Gestion Indépendants.
Jean-Christophe Rochat, Banque Heritage SA
Master en finance d’entreprises, Université Lyon III
Titulaire du CIIA, SFAA
Managing Director, en charge de l’asset management
Analyste / Gérant SRI Global Equity Fund, Lombard
Odier 2005-2009
Mikaël Safrana, Banque Heritage SA
B.Com en Finance & Stratégie de l’Université McGill à
Montréal. Titulaire du CIIA, SFAA
Directeur, en charge de la sélection de fonds long-only
En charge de la politique ISR de la banque Lombard
Odier de 2009 à 2011
Bluecap est une société dont
l'activité englobe la gestion
de patrimoine, principalement
d'avoirs privés, et le service
de conseil en prévoyance
Banque Heritage est une
banque privée sous
supervision de la FINMA
active dans la gestion de
fortune et la gestion de
produits d’investissement
innovants. Ses actifs
s’élèvent à CHF 5 milliards.
July 20Investment Services34
36. Fund selection methodology
Universe
Screening
• Based on the Morningstar Database
• Limits by size, domicile, currencies, liquidity, fees, etc.
• Can include multiples, KPIs based, mixed searches, etc.
Performanc
e Reporting
• Typically on 5y figures, sometimes 3y
• Quantitative screen based on «buy & hold» metrics
• Aims to identify funds with the best risk / return characteristics. Focus on volatility & behavior profile
• Establishes a ranking and basis for qualitative assessment
Qualitative
Assessmen
t
• Depending on the strategy, focuses on the top 5 to 12 peers
• Compares performance (discrete & rolling), upside/downside capture, risk/return,
style, sector exposure, etc.
Selection
• A shortlist of 3 funds is further established based on the above and in-
depth reviewed
• Uses conference calls, on-site visits, due diligence questionnaires, open
source information
• Selection of one final products. Internal documentation drafting
Review
• Recommended funds are reviewed between every
quarter and year, depending on the strategy
• Typically includes yearly on-site visits
• Uses quantitative filters to identify style drift, liquidity
mismatch, poorer performance, etc.
July 20Investment Services36
39. This document, as well as the information contained herein, is intended for informational purposes only and should not be construed
as an offer, solicitation or recommendation to buy, sell or subscribe to any financial instrument or banking services mentioned herein,
nor should be construed or considered as a contractual document.
This document is not directed at, intended for distribution to or publication for use by any person in any jurisdiction where such
distribution, publication, availability or use would be contrary to applicable law or would subject Heritage Bank Ltd, or any of its
affiliates, to any registration, licensing or other requirement within such jurisdiction. If you have any specific questions regarding
distribution restrictions please contact your relationship manager.
This document is not the result of a financial analysis within the meaning of the Swiss Banking Directive on Independence Financial
Research, which does not apply to this publication. Accordingly, the views expressed in this document are no official
recommendations of the Bank and should be considered as short term market comments for informational purposes only. As such,
the views herein are only indicative and may be subject to frequent changes without prior notice.
The opinions contained in this document do not take into consideration specific investment objectives, financial situation or particular
needs of any person who may receive this document. Each person must make his own independent analysis of the risks (including
legal, regulatory, tax) together with professional advisors, if necessary, before making any investment decision regarding any financial
instrument or financial market mentioned herein.
All information and opinions as well as prices, market valuations and calculations contained herein are subject to change without
notice. Its content is intended for the recipient only and should not be reproduced, published, circulated or disclosed to any other
person without prior consent of Heritage Bank Ltd. herein.
This document is intended primarily for internal staff of the Heritage Group but may be distributed upon request to institutional or
qualified investors but not to retail investors. Investors shall in particular bear in mind that past performance should not be taken as an
indication or guarantee of current or future performance and no representation or warranty, expressed or implied, is made by Heritage
Bank regarding future performance.
The information contained herein has been obtained from sources believed to be reliable, however Heritage Bank does not make any
representation whatsoever as to its accuracy or completeness. Accordingly, Heritage Bank accepts no liability for any loss arising
from the use of this document.
Investment Services July 2039
40. Contacts
Banque Heritage SA
Investment Services
61, Route de Chêne
Case Postale 6600
1211 Genève 6
Switzerland
Tel: +41 58 2200 000
pbis@heritage.ch
www.heritage.ch