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Securities firm Samuel A. Ramírez defines its expansion strategies

New managing director points the firm in a new direction


June 30, 2005
Copyright © 2005 CARIBBEAN BUSINESS. All Rights Reserved.

There is a whole world of opportunity awaiting securities firm Samuel A. Ramírez… literally. Héctor Mayol, the firm’s new managing director, believes the opportunity for growth—the potential source for a quantum leap, as he puts it—lies beyond the island’s shores. "Future growth will be in exportation of services," said Mayol, who brings to Ramírez & Co. 30 years of experience in the industry, in which he has held the position of president, vice chairman, and managing director of Santander Group, and has served as Financial Institutions commissioner from 1993 to 1995.

Mayol announced Ramírez & Co. plans to launch a money-management subsidiary by September that will be led by José Alberto Vizcarrondo. Vizcarrondo, who has served as manager of ING’s money-management division in Geneva for several years, will be returning to the island to assume this position. "The plan is to offer institutions a particular style of money management. We also plan on creating a retail product, a mutual fund," said Mayol, adding that it will be called the Global Opportunities Fund.

Mayol explained that portfolios managed by Vizcarrondo typically have half invested in big stocks from the New York Stock Exchange, and the other half invested in international companies. Vizcarrondo also has experience working in multicurrencies, which presents another set of investment opportunities. "We understand that in asset allocation of portfolios in Puerto Rico and on the U.S. mainland, this style is underrepresented right now, and clearly consultants are looking more and more toward the need to have [international] exposure as the U.S. loses the shine of being the most powerful economy in the world," stated Mayol. "Having this kind of investment management will add value to things being done in Puerto Rico that have been too focused on bonds, fixed income. We believe this is a niche where we can enter and not face that much direct competition because our investment offer is different."

Instead of functioning as a business bridge to the U.S.—as commonly occurs with Puerto Rico—in this case, the island could serve as a bridge for the U.S. to the international and global markets. "Ramírez is very interested in this project because we understand it can be offered to clients on the U.S. mainland…which grants a better opportunity of growth not only on the island but abroad as well," explained Mayol, adding that local operations expect to add more personnel to develop this area.

Mayol explained the San Juan office won’t abandon the retail business for individuals, but that right now the focus will be on the institutional area, including insurance companies, banks, government agencies, pension funds, and endowments.

Local opportunities

Mayol recognizes there is also room for growth in local market areas that have yet to be developed. For example, he offers 401(k) plans. "There are many investments being made in 401(k) plans that don’ include investments in Puerto Rico. There is no requirement for that as there is with IRAs, although I have always advocated it. If pharmaceutical x and bank x have a 401(k) plan for employees in Puerto Rico that has to be registered here, there should at least be a representation of local investments," said Mayol, explaining this could be a potential source of growth, since more investment information would be spread, facilitating financial education and leading more people to invest.

Despite the recent fall of the Puerto Rico Stock Index, the downgrading of the Commonwealth’s general-obligation bonds, and the political debate surrounding the approval of the budget, Mayol is optimistic about the local market. "The sky isn’t falling," he said. As an example of the continued interest in Puerto Rican business, he pointed out that over 100 rooms in the Conquistador Hotel were reserved by people from Orlando, Fla., who participated in the Chamber of Commerce convention.

The Ramírez Hispanic Index

Established in 1971, Samuel A. Ramírez & Co. is the oldest and largest Hispanic-owned investment bank in the U.S. Its headquarters are in New York, and in addition to the San Juan branch, there are eight other branches across the island.

In 2004, the company created the Ramírez Hispanic Index, which tracks the growth of the 10-largest and most-liquid Hispanic companies based on market capitalization and trading volume. Various Puerto Rico companies figure in the index—such as Banco Popular, Oriental Financial, and Doral Financial—proving the island’s business community is leading the way in the growth of the U.S.-Hispanic market. The Ramírez Hispanic Index rose 25% in 2004. This compares to 3% for the Dow Jones Industrial Average and 9% for the S&P 500 and the Nasdaq National Market.

Mayol emphasizes, however, Ramírez & Co.’s most important achievement is that the company has gone beyond the Hispanic market and successfully integrated itself into the mainstream market.

Ramírez & Co. plans to continue to expand its offerings and to grow, perhaps as fast as the growth of the Hispanic population in the U.S. In Puerto Rico, the growth of the company will have a great deal to do with Mayol’s expertise and ambition.

This Caribbean Business article appears courtesy of Casiano Communications.
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