Northern Trust AM names new Asia-Pacific head

Apr 4, 2016

Northern Trust Asset Management has promoted internally to replace Bo Kratz, who left late last year. The new chief will look to expand the firm's investment-outsourcing business in Asia.

Northern Trust AM names new Asia-Pacific head

Northern Trust Asset Management has transferred a senior executive from the US to oversee the Asia-Pacific region, including Australia and New Zealand, AsianInvestor can reveal.

John McCareins, who will move to Hong Kong this month from group headquarters in Chicago, will focus on building the firm's investment-outsourcing business in the region, among other things.

He replaces Bo Kratz, who left late last year to become Asia-Pacific chief executive at Conning, a US insurance asset and risk manager.

McCareins was most recently head of the retirement practice outsourced chief investment officer (OCIO) business within the multi-manager solutions group. He led a team that oversees multi-asset investment programmes totalling $60 billion of Northern Trust AM's $875 billion in global AUM.

McCareins now reports to Wayne Bowers, head of Europe, the Middle East, Africa and Asia Pacific at Northern Trust AM, and to William Mak, Asia-Pacific head of Northern Trust.

The firm has not significantly promoted its OCIO and multi-manager capabilities in Asia Pacific, Bowers told AsianInvestor, and McCareins’ appointment should generate more opportunities in that area. Northern Trust already provides such services to clients in Europe and the Middle East, but none in Asia as yet.

Bowers sees potential demand in Asia, as asset owners in the region are increasingly looking to diversify their portfolios both internationally and into different asset classes such as alternatives. Asset owners – or financial institutions such as private banks – might need an external asset allocation function or help with manager due diligence, he noted.

Allocation models were evolving, he added, in that a typical 30-40% exposure to fixed income might be replaced by assets such as infrastructure, private equity or property, which require very different manager oversight skills.

Bowers also expects to see growing interest in environmental, social and governance (ESG) investing in Asia, due to developments such as Japan’s new Stewardship Code and the anti-corruption and anti-emissions policies being promoted in China. This is an area where Northern Trust has built its capabilities in recent years, he said.

Northern Trust AM has active, passive and multi-manager investment capabilities, and its activities in the region include global equity portfolio management and dealing from Hong Kong. It also has investment strategy, relationship management and sales teams based in Hong Kong, Japan, Singapore and Australia.

With regard to recent client wins, last week the firm was announced as one of three managers (alongside BlackRock and Vanguard) to run a combined $2.1 billion mixed-equity mandate for Taiwan’s Bureau of Labor Funds.

McCareins had been a senior investment officer and client service leader in OCIO since 2005. He has also worked at US fund house T. Rowe Price, where he was responsible for mutual fund and sub-advisory product development.

His replacement at Northern Trust – an internal promotion – is set to be announced in the coming week or so.