Financial Services: good investments

Fruit of a merger between several Scandinavian banks which took place in 2000, Nordea benefits from the accumulated expertise of 150 years of financial dealings. In terms of market capitalisation, it is one of Europe’s 25 largest banks. Nordea’s coverage is highly impressive, particularly in Scandinavia, and, over the last ten years, offices in all the main Western European countries have been opened.

The 37 funds offered by Nordea to clients in these countries in its Nordea 1 package have all obtained official authorisation. In France, Benoît Schouler has been the head of the Scandinavian bank’s Paris branch since May 2003. A contraction of the phrase “Nordic Ideas”, Nordea places great store in honesty, transparency and ethics. These notions are integral to the bank’s approach to the management of its Value range, a range including four funds managed by Luxembourg-based Nordea Investment Funds, and a fifth comprised of North American shares managed in the United States.

Safeguarding capital
As Mr Schouler explains, Nordea is proud of the expertise and professionalism of its “fund managers and analysts. They focus on medium-term profits. Steady growth is a key factor.” Eschewing high risk and volatility, Nordea prefers to take an entrepreneurial approach to investment. The average period that Nordea invests in a given company is between four and five years. The companies making up Nordea’s portfolio are the object of a meticulous examination of both their strengths and weaknesses and the present state and future prospects of the markets in which they operate. Nordea’s policy is to invest in firms whose share value is likely to double in five years. According to Mr Schouler: “Our fund managers have cool heads and long-term objectives. Safeguarding the capital of our clients is one of their most important priorities.”

This prudent approach has been good for business. The European fund launched in 1989 has, over the last five years, generated an average annual return of 36.94%. Meanwhile, the American fund set up in 1997 produced an average yearly return of 54.89% over the same period (performance calculated at 31st January, 2006). Nordea also offers growth funds managed from the Copenhagen office. “Today’s market is no longer interested in average funds. These days, they have to be outstanding. Consequently, we have trimmed our portfolios to no more than 35-40 lines,” says Mr Schouler. While, as the Managing Director of the Paris office points out, Nordea “offers its funds to banks, multi-management firms, and professionals in the financial world” its products are, nevertheless, accessible to the general public via their usual fund managers or through fund management services such as Boursorama. Nordea: Scandinavian expertise for all!