Daniel Blamont has been responsible for transforming Phoenix's asset management unit from a traditional affair to one that now lies on the cutting edge of sophistication. Since joining in 2012, the head of investment strategy has led an overhaul of the company's asset management structure and shown skill in diversifying the portfolio into a new group of assets.
The work began with the development of Phoenix's strategic asset allocation framework for annuity funds, with a move away from traditional corporates and gilts towards alternative fixed income assets to improve risk-adjusted returns.
And the push away from traditional fixed income has been rapid – illiquid assets currently make up 15% of Phoenix's annuity portfolio from nothing just a few years ago – and the aim is to increase this to 40% over the next few years. Added to this, the insurer has acquired local authority loans, originated new loans bilaterally and invested in infrastructure and commercial real estate loans in recent times.
In addition, Blamont was the architect of an overhaul of corporate bond mandates so asset manager skills are now integrated with Solvency II metric improvements. The new mandates, implemented three years ago, have delivered around £100m ($140m) of capital resource improvements within Phoenix's £5bn portfolio – and resulted in very low downgrades and the absence of defaults on its annuity portfolio since 2015.
In parallel with this, Blamont has been involved with developing a group hedging framework to handle future asset risks. The framework is flexible enough to deal with the latest sources of exposures or new risk metrics. Blamont's team is currently developing it to counter the potential of credit spread risk exposure for Phoenix's first ever move into bulk purchase annuities, announced earlier this year.
Market participants have been effusive of Blamont's skills to convert theory into practice. One asset manager said: "There were several transactions in the write-up on Dan that actually got done. That's more meat on the bone than the asset manager stars who often show thought leadership, but have implemented very little of the transactions they talk about."