The markets of Latin America are disparate and ever-changing, but the region’s top sales teams are steadfast.
Volatility has been the story the last 12 months, as more countries like Chile and Colombia elect leftist leaders and rates rise across Latin America on the back of higher inflation, according to Ashley Farrar, head of U.S. sales at BTG Pactual.
“The role of sales hasn’t changed,” she said. “We are still here to add value to our clients via alpha generating ideas, corporate access, and high-quality research, but managing the post-Covid, hybrid work.”
This reliable excellence has been recognized once again, as BTG Pactual was voted No. 1 in Institutional Investor’s 2022 Latin America Sales Team, based on the opinion of more than 360 buy-side money managers at 268 firms.
Bradesco BBI increased one spot from last year to take second place, while JPMorgan Chase & Co. took third. BofA Securities and Santander placed fourth and fifth, respectively. In line with other II surveys, the survey responses were weighted by each respondent’s commission spend in the region. An additional leaderboard weighted by assets under management was also produced, which closely mirrored these commission-weighted results.
Firms were ranked based on six attributes: adding value to research, providing a global context, idea generation, market knowledge and feel, service and responsiveness, and understanding client needs. BTG Pactual topped all but one of these, with JPMorgan singled out for its ability to provide a global context to its clients.
Carlos Lima, head of onshore LatAm Equity Sales for JPMorgan, credits the firm’s global footprint and research product. “We are well staffed in the region with senior team members but a relatively lean structure,” he said. “The way we differentiate ourselves is by our product offering and a partnership approach where we sell the firm, not the equity product alone. In bullish markets where everyone is making money, it’s harder to differentiate itself, but when the tides turn that’s when relationships are solidified and JPMorgan truly shines.”
After capital markets in Latin America experienced their busiest season, things took a sharp turn and performance took a big hit, Lima added. “That led to significant redemptions and a move away from equities into fixed income with the rise in interest rates,” he said. “That’s not an easy fix and the force behind the bullish equity markets in the past couple of years became an important headwind. With that background, sales had to quickly adapt and get closer to the day-to-day of the desk monitoring flows and closely watching international markets.”
For sales teams to be successful, a culture of collaboration and partnership is essential, according to BTG Pactual’s Farrar. “The biggest key to our success is that we truly work as a team and that applies to everyone in the bank, not just in equities or equity sales, and that always goes back to the partnership culture,” she said.
While the biggest obstacle to the sell-side is still the threat that index funds and ETFs pose to active management, this year has shown why firms like BTG Pactual shine. “This is where the volatility we have seen the last year can actually help, because it proves the value of active management. For sell side firms like BTG that excel at value added, alpha generating research and sales, this environment should only increase our competitive advantage,” Farrar said.
