Petrarca capital test pla
-
Upload
vimvipa-poome -
Category
Design
-
view
674 -
download
0
Transcript of Petrarca capital test pla
Strictly Confidential. | Not For Distribution to the General Public.
Q2 2012INVESTOR PRESENTATION
Petrarca Capital Management, LLCGlobal Financials Sector Fund
PETRARCA OVERVIEW
INTRODUCTION TO PETRARCA CAPITAL
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
�/RQJ�VKRUW�HTXLW\�VWUDWHJ\�IRFXVHG�RQ�WKH�JOREDO� financials sector
STRATEGYStrategy
Managing Partners
Investment Process
Portfolio Characteristics
Alignment of Interests
INTRODUCTION TO PETRARCA CAPITAL
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
MANAGING PARTNERS Strategy
Managing Partners
Investment Process
Portfolio Characteristics
Alignment of Interests
Ã�Robert Lacoursière, former Partner and Head of Global Banks at Paulson & Co. and James Fotheringham, former Senior Vice President at Paulson & Co.
�Managing Partners have four decades of aggregate ex- perience analyzing financial securities up and down the capital structure, across countries and continents, over economic cycles and during financial crises
�Managing partners were responsible for ~$10bn in as many as 70 financials sector positions in each of their four years at Paulson & Co. (2008-2012)
Strategy
INTRODUCTION TO PETRARCA CAPITAL
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
INVESTMENT PROCESS
Managing Partners
Investment Process
Portfolio Characteristics
Alignment of Interests
�([KDXVWLYH��UHSHDWDEOH�LQYHVWPHQW�SURFHVV�LQWHJUDWLQJ idea generation, portfolio construction, risk manage- ment and ongoing portfolio rebalancing
Strategy
INTRODUCTION TO PETRARCA CAPITAL
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
PORTFOLIO CHARACTERISTICS
Managing Partners
Investment Process
Alignment of Interests
�7UXO\�JOREDO��LQYHVWLQJ�DFURVV�(XURSHDQ��/DWLQ�$PHULFDQ�� Asian, as well as North American financials securities
�3UHGRPLQDQWO\�FRPPRQ�HTXLW\��EXW�FDQ�RSSRUWXQLVWLFDOO\� invest higher in the capital structure
�)DLUO\�FRQFHQWUDWHG��W\SLFDOO\�������VKRUWV��������ORQJV�����DQG�GLUHFWLRQDO��JHQHUDOO\��������QHW�H[SRVXUH��EXW�OLTXLG����SRVLWLRQ�VL]H���[�GDLO\�YROXPH��DQG�OLPLWHG�OHYHUDJH����[� gross exposure)
Ã�+ealthy mix of investment themes (macro, sector, ��VLQJOH�QDPH���UHWXUQ�YRODWLOLW\�H[SHFWDWLRQV��IURP�´EXQWVµ���WR�´KRPH�UXQVµ��DQG�SRVLWLRQ�GXUDWLRQV��JHQHUDOO\����� months)
Portfolio CharacteristicsPortfolio Characteristics
Strategy
INTRODUCTION TO PETRARCA CAPITAL
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
�0DQDJLQJ�SDUWQHUV�HDFK�KDYH�D�VLJQLILFDQW�SRUWLRQ�RI�WKHLU net worth invested in the fund
ALIGNMENT OF INTERESTS
Managing Partners
Investment Process
Portfolio Characteristics
Alignment of Interests
MANAGING PARTNER BIOGRAPHIES
ROBERT LACOURSIÈREManaging Partner, Chief Investment Officer and Co-portfolio Manager
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
�Prior to co-founding Petrarca, Robert was a partner at Paul son & Company where he was Head of the Global Banks Team. �Robert has over �� years experience in the global financials sector. �Prior to joining Paulson in 2008, Robert covered US Mortgage and Specialty Finance as a widely-respected sell-side HTXLW\ research analyst at Banc of America Securities. �Prior to that Robert was Head of Financial Strategy at Capital One, and covered US mid-cap banks at Lehman Brothers where he had also been the Director of Latin American (Tuity Research. �Robert headed the Latin American Financial Institutions ��(TXLW\ Research Group at Bear Stearns from New York as well as at Santander Securities from Mexico City.�Before his time on the sell side, Robert worked at the Bank of Nova Scotia in Toronto as a Manager of Latin American Investments. �Robert has an M.B.A. from I.E.S.E. in Spain and a B.A. from the University of Western Ontario in Canada.
�Robert has been married 21 years and has two daughters, aged �� and ���
Placeholder
MANAGING PARTNER BIOGRAPHIES
JAMES FOTHERINGHAMManaging Partner and Co-Portfolio Manager
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
�3ULRU�WR��FR�IRXQGLQJ�3HWUDUFD��-DPHV�ZDV�D�6HQLRU�9LFH�3UHVL� dent at Paulson & Company covering the global financials sector from 2008 to 2012. �3ULRU�WR�MRLQLQJ�3DXOVRQ��-DPHV�VSHQW�QLQH�\HDUV�DW�*ROGPDQ���6DFKV�DV�D�VHOO�VLGH�HTXLW\�UHVHDUFK�DQDO\VW�FRYHULQJ�86�0RUW� gage and Specialty Finance from New York and European banks from London.
Ã�-DPHV�KDV�D�'�3KLO��IURP�2[IRUG�8QLYHUVLW\�LQ��WKH�8QLWHG� Kingdom, as well as M.Sc. and B.Sc.H. degrees from Queen’s University in Canada
�-DPHV�KDV�EHHQ�PDUULHG����\HDUV�DQG�KDV�WZR�FKLOGUHQ��DJHG� nine and seven.
Placeholder
MANAGING PARTNER BIOGRAPHIES
JAMES FOTHERINGHAMManaging Partner and Co-Portfolio Manager
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
EXPERIENCE�$�6(1,25�9,&(�35(6,'(17 Paulson & Company 2008-2012 The global financials sector
�$�6(//�6,'(�(48,7<�5(6($5&+�$1$/<67 Goldman Sachs����������� US Mortgage and Specialty Finance
('8&$7,21Ã�'�3+,/�� Oxford University in the United KingdomÃ�0�6&��$1'�%�6&�+��'(*5((6� Queen’s University in Canada
FAMILY LIFE�%HLQJ�PDUULHG�IRU����\HDUV����FKLOGUHQ��DJHG�QLQH�DQG�VHYHQ����
Placeholder
TEQUILA CRISIS
RUSSIAN DEFAULT
ASIAN CRISIS
EMERGING MARKET FINANCIAL-LIBERALIZATION
US SUBPRIME BUBBLE
GREAT FINANCIAL CRISIS
BANK BAILOUTS
PIIGS SOVEREIGN CRISIS
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
BRADY BOND PLAN
MEXICAN BANK PRIVATIZATIONS
Managing Partner,Chief Investment Officer& Co-Portfolio Manager
Managing Partner,Co-Portfolio Manager
MANAGING PARTNER EXPERIENCE
Canada Europe Latin America U.S. Global
BANK OF NOVA SCOTIAManager
�����
�����
�����
�����
�����
����������
�����
�����
�����
JAMES FOTHERINGHAM
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
ROBERT LACOURSIÈRE
Placeholder PlaceholderFINANCIALS SECTOR GLOBAL EVENTS TIMELINE
IESEMBA
BANK OF NOVA SCOTIAManager, Latin America Invesments
SANTAN'(593��+HDG�RI�/DWLQ�$PHULFDQ�%DQN�(TXLW\�5HVHDUFK
BEAR STEARNS0'�3ULQFLSDO��+HDG�RI�/DWLQ�$PHULFDQ�%DQN�(TXLW\�5HVHDUFK
LEHMAN BROTHER693��'LUHFWRU�RI�/DWLQ�$PHULFDQ��(TXLW\�5HVHDUFK693��8�6��0LG&DS�%DQN�(TXLW\�5HVHDUFK
CAPITAL ONEHead Financial Strategy
BANK OF AMERICA SECURITIESPrincipal, U.S. Mortgage, Consumer &6SHFLDOW\�)LQDQFH�(TXLW\�5HVHDUFK
3$8/621��&2���,1&�Partner, Head of Global Banks
�����
�����
�����
����� 3$8/621��&2���,1&�SVP, Global Banks
*2/'0$1�6$&+6$VVRFLDWH��(XURSHDQ�(TXLWLHV93��(XURSHDQ�%DQN�(TXLW\�5HVHDUFK
*2/'0$1�6$&+693��86�0RUWJDJH��&RQVXPHU��6SHFLDOW\�)LQDQFH�(TXLW\�5HVHDUFK�
2;)25'D Phil
Managing Partner2
Chief Investment Officer (CIO)&R�3RUWIROLR Manager
Robert Lacoursière
Managing Partner2
&R�3RUWIROLR Manager
James Fotheringham
Chief Operating Officer(COO)
7%'
Trader
7%'
Analyst
7%'
Financial Controller
7%'
1 Organizational structure will broaden to support anticipated growth in assets under management2 Managing partners share portfolio responsibility; CIO has ultimate portfolio discretion
Office Manager
7%'
PRIME BROKERS Goldman, Sachs & Co.Credit Suisse
LEGAL COUNSEL Seward & Kissel LLP (U.S.)Ogier (Cayman)
AUDITOR TBDADMINISTRATOR TBDBANK TBD
Service Providers
PROPOSED ORGANIZATION
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
IDEA GENERATION
���
40�
���
60�
70�
80�
-1x 0x 1x 2x �x 4x �x 6x 7x 8x
GEOGRAPHICAL MONITOR (illustrative, from Q4’11)
HIGH OPPORTUNITY
MODERATE OPPORTUNITY LOCAL MACRO CONVICTION REQUIRED
MODERATE OPPORTUNITY GLOBAL MACRO CONVICTION REQUIRED
LOW OPPORTUNITY
Country Sensitivity to Global Economic Growth1
Fina
ncia
ls P
rice
Rel
atio
nshi
p to
Dom
esti
c Ec
onom
y2� Financials are a levered play on
economic cycles
� We focus on countries levered to changes in global growth, and financials securities most sensitive to their domestic economies
� We time investments according to macro inflection signals and expected policy responses
Russia
ChileSouth Korea
India
Poland
Malaysia
Colombia
Norway
Brazil
Mexico
Sweden
PhilippinesAustralia
Thailand
Canada
Hungary
Czech Republic
Argentina
Singapore
Peru
Denmark
Netherlands
Taiwan
Spain
France
Switzerland
ChinaHong Kong
USA
Japan
Turkey
UKGermany
Italy
Bubbles sized in proportion to market capitalization
1. ConseTuent change in each country’s annual growth in nominal GDP in USD from a 100bps change in annual growth in nominal GDP in USD of the G7 countries plus China. versus annual growth in nominal domestic GDP. SourFH� Bloomberg.
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #
2. Relationship (R2) between Tuarterly share price performance of financials stocks
28x
26x
18x
14x
12x
0x
�x
10x
��x
20x
��x
��x
Canada Europe Asia LatAm USA
Fina
ncia
l Co
mpa
nies
’ Le
vera
ge1
TA (
US
GAA
P) �
TCE
Capital DGHTXDF\ is an important input into our sector analysis framework
We gauge capital DGHTXDF\ by gross tangible assets (US GAAP) to tangible common HTXLW\
Relative leverage allows us to contextualize existing and potential regulatory forbearance
Leverage differs among regions, as well as among companies within regions
1. Leverage calculated as tangible assets under US GAAP over tangible common eTuity; tangible assets are estimated wherever US GAAP eTuivalents are not disclosed.SourFH� Company reports, Petrarca estimates.
SHORT ABOVE THE LINERisk of share dilutionDQG�or weaker growth
BUY BELOW THE LINEExpectation for capital return
DQG�or stronger growth
LEVERAGE THRESHOLD
CAPITAL ADEQUACY MONITOR (illustrative, from Q4’11)
INVESTMENT PROCESS IDEA GENERATION PORTFOLIO CONSTRUCTION RISK MANAGEMENT SUMMARY FUND INFORMATIONPETRARCA OVERVIEW
Page #