2010: A new era in financial services?

by Julia K. Wakefield, Senior Account Executive
2009 was no less than an epic year for financial failure and fraud. And it ain’t over yet. Scandal and losses are still unfolding from the likes of Rothstein and Madoff; banks are readying for further losses on risky real estate investments and credit default swaps; and while the stock market is slowly clawing its way back up, Americans have experienced a destruction of wealth unlike anything we’ve ever seen before.

So what’s ahead in 2010 for the financial services arena? One thing is clear – firms that can demonstrate integrity, transparency, and risk-averse strategies will come out winners as skittish investors steer clear of managers with even the slightest chance of conflicts of interest or volatility-producing investment philosophies.

Today’s article from Private Asset Management speaks to the emergence of this trend with a profile of our client, Lydian Bank & Trust, a private bank and wealth management firm. Lydian’s Miami office has experienced a surge in growth despite opening during one of the most turbulent periods ever in the banking industry. What’s attracting clients?
The bank shuns proprietary offerings and instead works with more than 100 boutique managers, noting performance, experience, expertise and management team and strategy stability during regular due diligence checks.
The article takes note of the fact that investors are seeking greater diversification in this time of financial conservatism; we can assume that diversification in asset class, industry, and geography is no longer enough. Today, to spread risk around enough to ride out market volatility, diversification in managers is critical too.

What’s more, finance specifically in South Florida is evolving in the new era as well. Emblematic of the investment environment in South Florida, Lydian is seeing an influx of international clients not only from Latin America, but also from Europe and the Middle East.  According to Lydian’s Miami regional president Orlando Roche,
Miami is truly becoming a global city, and its great market advantages and tax situation are supporting the growth.
What lies ahead remains to be seen. But it looks like we’ve got reason to be optimistic. From all of us at Schwartz Media Strategies, we wish you a happy and prosperous New Year!