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Hermes’ Steel: 'how we broadened from institutional-only to embrace retail'
by Elsa Buchanan on Sep 23, 2013 at 14:10
Harriet Steel, global head of business development at Hermes Fund Managers, joined the group just under two years ago and led its entry into the UK and European wholesale markets.
‘Before I joined [in November 2011], I thought Hermes was only a pension firm. It was the opportunity to take a platform that was owned by the largest pension scheme on the island, and turn it from a traditional manager into an innovative business,’ Steel said.
While she described the business as ‘a well-founded start-up’-type firm, third party assets were very small, she said: 'They were just a couple of billions.’
To drive expansion Steel grew the business development team from 20 in December 2011 to 52 currently. This included key hires such as Barings’ Ian Pascal as head of marketing and communications, Rhodri Mason, head of investment solutions and product strategy and bringing in Clive Selman as head of UK wholesale from Man Group.
‘There was low-hanging fruit, but no one to distribute the propositions,’ she said. ‘We realised a lot of the products were good for the wholesale market, but also that we were not at the right stage to address the retail market.’
After recognising competitors were facing pressure from the Retail Distribution Review (RDR) and the impact it would have on their legacy business, Steel was able to launch with just clean share classes.
On the back of the establishment of a 12-strong Dublin-domiciled range of mutual funds, Steel said Hermes now manages £24.9 billion of client assets across its alternatives, equities and fixed income divisions.
Steel is focusing on the ‘20% of allocators who run 80% of all assets’, as well as global bank platforms and discretionary wealth managers, trebling the number of third party mandates it runs. Indeed, third party assets have grown by 150% from £2 billion in January 2012 to £5 billion in September.
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