Where does Legg Mason have an international funds presence outside of the parent company’s US Baltimore headquarters?
Jaspal Sagger: We have fund ranges in Europe – in the UK and in Dublin – and also in Singapore, Australia and Japan. We want to build scale and to provide one-stop access to our distributors, which has involved realigning some of our legacy businesses.
For example, when we acquired Martin Currie recently, it came with a UK and Luxembourg fund range. In March this year, we completed a transition from Luxembourg to Dublin to our flagship Global Funds umbrella.
How is Legg Mason positioned following the UK’s decision on Brexit?
Justin Eede: We were reasonably well prepared for whichever way the Brexit vote went. We have what we describe as parallel distribution and product strategies. There is a UK fund range, designed primarily for distributors in the UK, and then the Dublin fund families that have been registered for sale across many jurisdictions in Europe.
We have been tweaking the UK fund range recently to make it more relevant to the UK advisory market. A recent example of that is the launch of the Legg Mason Rare Global Infrastructure Income Fund, which took place on 1 July.
JS: I believe ours was the first fund launch in the UK post-Brexit. Of course, we needed to make sure the markets were behaving themselves, which they did.
Brexit was a disruptive factor to some degree but that didn’t put us off because, ultimately, we know our UK clients are still going to want wealth management products.
The fund invests for income. Given that it is related to infrastructure investments, something we think is going to become more diversified and global in nature, it is an area of the market clients are interested in.
Last year, we acquired a business called Rare, which we wanted to bring to the marketplace. It is a Sydney-based, listed equity infrastructure, with a 40% market share in Australia, and a great addition to our family. We have also inherited the two mutual funds it has on its Rare Dublin umbrella.
There is no point overreacting to Brexit because nobody can predict what the relationship will be with Europe, and whether or not it will be similar to the Swiss or Norway models.
We need to be conscious of what the options are and how we are positioned today relative to what we think might happen. We are having Brexit meetings, which are related to the limited amount of information we know at present, but we are not going to go overboard about setting up new companies and businesses until we know what the relationship will be.
Is there an element of kicking certain plans into touch?
JS: Our global product strategy is something we are consistent about in terms of where we see the trends in the marketplace and what clients are looking for, and continues to evolve with clients' needs. How we get that product to market could change but we are not clear yet as to where that may end up.