The turmoil in capital markets and changes in the regulatory environment over the past several years have sparked significant changes in bank investment portfolios – and caused many banks to reevaluate portfolio management practices.
-Sabrina Callin, head of client solutions, PIMCO
-Justin Ayre, senior vice president, PIMCO
May 3, 2012
- Banks without the resources to develop new internal processes may be forced to significantly limit their investment opportunity set, possibly limiting earnings and diversification potential in the securities portfolio.
- The investment portfolio may represent an opportunity to improve bank revenues and risk-adjusted performance by expanding into investments with improved return and diversification potential.
- Some banks may have the infrastructure and expertise that allows them to achieve an optimal investment portfolio risk/return profile. In other cases, appropriate resources can be brought on board within a reasonable time frame.
