BCP is working hard for the hard-earned money of its clients, says John Calvert, CEO at BCP Asset Management. (Accountancy Ireland, Issue 1 | February/March 2022)
In an increasingly volatile market, clients’ needs have to be addressed creatively and holistically, according to John Calvert, CEO at BCP Asset Management.
BCP is a private, family-owned, boutique asset management firm that specialises in creating investment solutions at the conservative end of the market. The company, established in 1969, has been in existence for over 50 years. The majority of its products have varying levels of capital protection attaching, with capital preservation coupled with the ability to generate consistently attractive returns as its primary goal. The company currently manages over €3 billion in assets on behalf of its customers, spanning private clients, pensions, corporates, charities/religious orders, and credit unions.
“The breadth of our network of leading international banks combined with our specialist expertise, allows us to offer ‘best in market’ terms, as well as bespoke products, to suit the exact needs of our customers,” says Calvert. “As a family-owned business, we are able to take a long-term view, particularly in terms of looking after clients and client retention. Some clients have been with us for well over 30 years, and the consistency of looking after their wealth through the inevitable investment cycles is very important. We don’t have pressure from shareholders to deliver results instantaneously, and this gives us the freedom to take a long-term approach which is client first. The success of the business flows naturally from this approach.”
“We issued our first structured product 30 years ago, and we are officially the market leader in Ireland in this area. These products allow people to target a certain amount of upside and to have a defined level of downside protection in order to manage their risk exposure during inevitable market cycles. Focusing on developing our expertise in these defensive products has helped build on our credentials as a conservative investment manager looking to accumulate wealth for clients. Our outperformance during periods of market stress in the past has led to step-leaps in the firm’s assets under management.”
Bank deposits in Ireland have grown substantially during the pandemic, and now with both Ulster Bank and KBC withdrawing from the Irish market, the options for depositors & lower risk investors are dwindling. Calvert says BCP’s lower-risk products have become increasingly valued by depositors looking to escape the depreciating impact of negative deposit rates and elevated inflation in the current financial climate. “Among our current suite of structured products are the Enhanced Equity Bond 6, a Bond that combines access to enhanced global equity performance with 85% or 90% capital protection at maturity and all returns added to capital invested. Capital protection is provided by BNP Paribas, one of the strongest banks in the world. We launched a new type of defensive equity investment solution at the end of 2021 with Barclays Bank Ireland, the Target Coupon Bond. This bond is resonating with people who are becoming less bullish about the next ten years in terms of equity market performance and want more defensive protections. This bond pays investors 5% p.a. even if markets fall by up to 30%. This is a capital at risk product. Details of these products and our other products are available on our website at www.bcp.ie.”
Calvert says that it is essential for BCP to develop products based on client feedback regarding what they are actually looking for and then build solutions around the needs of investors. “We don’t go pushing a product to a particular group. We go to the market, take feedback and then design a solution to match that feedback.” BCP’s culture, says Calvert, is critical to the company’s success. “As I remarked earlier, our culture is “client first”, and that is critical to the way we do business. If you have that culture, success flows from there for everyone. Your investments are in the best interests of the client, and that loops back to growing the business in a sustainable way and growing the funds that we manage. By constructing products in a conservative fashion that can successfully navigate periods of stress, we have been able to carve out our own niche business that has enjoyed consistent long-term growth.” In the pandemic and post-pandemic era, says Calvert, an increasing number of clients will see the value of BCP’s solutions, with the related risks of inflation and rising interest rates in particular driving more conservative attitudes. “People are asking more questions, and last year we saw a significant rise in our retail client activity. With the increase in volatility in the equity markets, clients are becoming more risk-aware, and they are more inclined to protect their investments. On a personal note, I would also add that 100% of my own pension is invested across a spread of BCP investment products, while a high proportion of existing and former staff also have parts of their pensions invested in BCP products. From my perspective, this demonstrates the level of conviction we have about the quality of our investment offering and aligns key BCP personnel with investors.”
The changing financial landscape in Ireland and abroad also poses challenges, says Calvert. “At a country level, the consolidation in financial services providers, in particular Banks, has drastically reduced the choice for consumers. I think we need to critically and openly assess the reasons for this consolidation and address these areas in order to have a vibrant and growing financial services sector, which is capable of delivering a great service and choice to consumers.” Calvert says BCP will have an increasingly vital part to play in this journey. “We will continue to work exceptionally hard to meet the needs of conservative investors and develop innovative solutions to meet those needs.”
Calvert qualified as a Chartered Accountant in 1995 and says he is particularly conscious of the demands placed on financial controllers. “Almost all companies are suffering the impact of negative deposit rates, but at the same time, companies need to carefully manage their surplus funds. We believe our product range can help companies balance these competing forces. We are a conservative investment manager, ingrained in the community, with a 50+ year track record, and pride ourselves on delivering the highest levels of customer service in the market.”