Loomis Sayles' insurance team has been around since 2018 and has tailored itself to the requirements of insurers in managing highly regulated and constrained investments.
The company has doubled its insurance assets to $20bn in that time and it continues to make strategic efforts to stay out front through several differentiators.
The company's multi-asset investment process focuses on insurer's unique considerations, whether it's their gain/loss budget or book-yield oriented mandates.
One key point of interest is the company's proprietary Crisis Sensitivity Ratio (CSR), which attempts to highlight increasing probabilities of a crisis. This ratio was developed by engineers focused on cancer research and is a top-down measure that helps identify asset bubbles better in multi-asset credit.
In recent times, the team has worked proactively with clients to develop customised portfolios. One client, who originally had a sleeve approach, was looking to transition to a multi-sector mandate for a more risk-on approach and to take advantage of dislocation in the market. Loomis did an analysis on their existing portfolio exposures to provide a solution on how it would manage their bespoke insurance constraints as well as maximising their book yield. It came up with value during market disruption while applying insurance expertise to propose a solution with renewed asset allocations to meet their portfolio objectives.
Another of its longstanding municipal bond clients came to the firm inquiring about its ability to manage a no benchmark, absolute return strategy incorporating Loomis' capability to invest in the breadth of credit across the investment spectrum. Working closely with this client, it established a loss budget due to moves in interest rates, and migrated the existing portfolio to an investment grade, absolute return mandate. This transition ultimately boosted the client's after-tax investment yield by nearly 60bps. This mandate was the first of its type for Loomis Sayles and has helped us to attract further clients.
Concrete examples and a focused insurance approach have helped Loomis Sayles to win this year's multi-asset manager of the year.