SAO PAULO Credit Suisse Group AG (CSGN.VX)(CS.N) and star fund manager Luis Stuhlberger agreed to set up a new asset management venture under his control, extending the bank's relationship with Brazil's most coveted money manager.
The venture, to be named Verde Asset Management, will open next January, with Credit Suisse and some of Stuhlberger's associates as minority partners, according to a statement. The new venture will manage about 30 billion reais ($13.6 billion) in client money, about 50 percent more than what Stuhlberger handles as chief investment officer of Credit Suisse Hedging Griffo, the bank's money management unit in Brazil.
The statement confirmed on Wednesday a Reuters report that Stuhlberger would control the venture. Under the plan, Credit Suisse and Stuhlberger will propose that clients allow Verde Asset Management to assume control of funds currently invested in the Verde family, and return about 40 percent of the fund's capital to investors in four bi-annual installments, a source with direct knowledge of the situation told Reuters.
"With this, our clients will continue to have access to the best investment options through our large platform of products and services," said the statement, which was signed by José Olympio Pereira, chief executive officer of Credit Suisse's Brazilian unit.
The agreement allows Credit Suisse to retain the star money manager, whose Verde hedge fund has an awesome total return of nearly 8,000 percent since its inception in 1997. The tie-up between the bank and Stuhlberger began in 2006, when the Swiss company bought 51 percent of Stuhlberger's investment firm Hedging-Griffo, earning Credit Suisse over 4 billion reais in profits.
Brazil's fund industry, the world's sixth-largest with more than $1.2 trillion in assets, has grown rapidly in recent years in the wake of a surge in the number of new millionaires in the second biggest emerging market economy. The success of money managers such as Stuhlberger has lured assets from some of Brazil's newly wealthy to hedge funds specialized in trading everything from commodities to currencies, asset-backed securities and global stocks.
While the amount that could be transferred to Verde represents about 45 percent of Credit Suisse Hedging-Griffo's 65 billion reais in assets under management, the bank agreed to allow Stuhlberger to have an independent structure ahead of the end of a non-competing clause next year, said the source.
Recently, Credit Suisse hired Fabio Okumura, head trader of Itaú Unibanco Holding SA's (ITUB4.SA) proprietary trading desk, and eight of his associates to create new products, another source told Reuters last month.
Stuhlberger began his career in the early 1980s as a gold trader. He and his partners sold the remainder of their stake in Hedging Griffo to Credit Suisse at the end of 2011.
($1 = 2.20 Brazilian reais)
(Reporting by Guillermo Parra-Bernal; Additional reporting by Brad Haynes in São Paulo; Editing by Jeffrey Benkoe and Phil Berlowitz)