Financial Consulting - Special Advertising Section

Back to Contents of Issue: October 2002

Today's expatriate faces many obstacles to achieving peace of mind. Dealing with a general state of economic uncertainty, many expatriates have realized that there is a world of expertise available that can bring a wealth of investment opportunity. There are various companies within this field providing financial. legal and educational advice that can lead to a future of prosperity for a long-term foreigners in Japan.

Magellan Tresidder Tuohy (MTT) is a company offering offshore investment planning for expatriates that realize overseas life is both financially rewarding and uncertain. The company offers investment planning that establishes a wealth base in one central, secure offshore environment, free from the tax and financial restrictions that apply to local regimes. To the successful and motivated expatriate, this means you are free to change location without having to carry the burden of transferring your assets with you. Towry Law International (TLI) is unique to the field as it is registered with the Ministry of Finance here in Japan therefore one of the few Western companies legally able to provide investment advice here in Japan. As a member of the leading financial services group AMP Financial Services, which has assets under management in excess of $145 billion, it has access to a wide range of resources from across the group. TLI services can be broken down into two distinct categories; firstly financial planning, which includes, retirement planning, savings schemes, education fees planning, international mortgage advice and international private healthcare. The other area is asset management and portfolio services using a very wide range of mutual funds through our unique Fundsmart service which offers clients access to over 1,400 mutual funds in an interactive nominee account allowing clients to access their own valuations online 24 hours a day, 365 days a year. Towry Law International makes no charge for this service. Information Management Network (IMN) was established in New York City in 1994 to offer educational programs of the highest quality for the international investment community. IMN annually organizes over 50 global events, including nearly 10 in Asia. An example of IMN's work in Asia is the Japanese Summit on Real Estate Finance and Securitization, held in Tokyo each year. Debuting at the Palace Hotel in 1998, this summit has annually attracted over 400 high-level attendees from Japan and abroad. Alison Pockett; president and founder of Magellan Tresidder Tuohy (MTT), Alan Smith; managing director of Towry Law International (Japan), Eliot Jacobwitz; director of Information Management Network (IMN) and Simon Litster; business development director of MTT explain the expertise and resources they bring to Japan's expatriate community. What is your corporate strategy? Alison Pockett: We provide a full financial planning service and are 100 percent independent therefore not reliant on any one provider. Due to our solid background and reputation we have agency agreements with all the major financial institutions and provide their link to the consumer. In 1999, we employed Simon Litster as our Business Development Director and carried out a complete review of our services. Simon Litster: Most individuals will have a large proportion of their net assets in property and traditionally IFAs would not cover any aspect of this. Since the majority of our clients live in Japan where interest rates are the lowest in the world and most earn in yen, it seemed to make sense to try to secure yen loans for their property purchases back home. So we approached a major AAA rated UK bank that offered multi-currency loans to expatriates. They conducted their due diligence on us and granted us an agency agreement. We then were able to advise clients on all aspects of their lives from health and life assurance to investments and mortgage loans et cetera. What are the demographics of your company's typical client? Alan Smith: Our clients are English speaking expatriates ranging from those who have been in Japan for less than 12 months, perhaps as one of many offshore postings, all the way through to expatriates who have been in Japan for 30 years plus. Our clients are financially sophisticated and demand high levels of service and information. They tend to be extremely busy and require us to provide a high quality, performance driven service. How do you differentiate yourselves from your competition? Alison Pockett: It is very important also to pose 'what if' questions to clients. Often, we find that people had never been asked these questions and they are surprised at the scant advice they had previously received elsewhere. One thing we pride ourselves on that sets us apart from the rest is the added value services we provide such as offshore company formations, tax planning, estate planning or writing wills. We can accept and help clients of all nationalities and being an independent company are not governed by corporate directives of what can and cannot be sold to a client. What have been some of the economic challenges of operating this business in Asia recently? Alison Pockett: Actually the Japanese recession was in its third year when we formed MTT, so we have known nothing else in terms of the local economy. There have and always will be market recessions and downturns. The latest global downturn in stock markets has been longer than everyone expected. In such times, it is more important than ever for clients to review their portfolios with our advisers and diversify. One diversification is to buy into hedge funds. These can make profits in falling and rising markets and there has been an explosion of new funds on the market. This area of investing needs to be understood and explained thoroughly. MTT will not recommend a hedge fund group unless there is a sound structure behind it and more importantly a long successful record of accomplishment. We have been recommending funds from two or three such companies since 1996 and clients have reaped great returns. Such funds now carry capital guarantees since a major international bank safeguards an investor's money. Alan Smith: There have been many challenges over the last few years; however, our conservative style of financial planning and asset allocation has ensured that clients have been sheltered from the falls in equity markets over the last two years. As Asia's largest independent distributor of retail mutual funds, we have access to some of the best absolute return funds available world-wide, and these have made positive returns for investors in both rising and falling markets. What are some challenging aspects of operating conferences in Japan? Eliot Jacobowitz: We began organizing financial conferences (specializing in fixed-income events) in 1994 and over the past nine years have grown to become one of the largest global organizers of financial conferences. We organize large industry events annually in the US, Asia and Europe. To overcome some of the problems currently challenging our core clientele in Japan, we have been very active in developing strategic marketing alliances, soliciting the marketing support of our sponsors and aggressively encouraging the participation of buy-side participants. The biggest challenge we face is the comparable cost of doing business in Japan relative to the rest of Asia and the West. In addition, we have partnered extensively with local affiliates in order to localize our global presence. What are some differentiating aspects of operating your business in Japan as opposed to other regions of Asia or the West? Alan Smith: The retail market for International Offshore investments in Japan is still in the embryonic stage. The experience that we have gained from our international head office in Hong Kong which has been established for over 20 years puts us in a strong position to deal with the maturing investment market here. It is our desire to work with both Japanese regulators and domestic financial institutions to assist in the education of Japan resident investors. Alison Pockett: The main difference is of course the cost of operating an office here. Despite 10 years of recession, Tokyo remains one of the world's most expensive cities. One of the other frustrations is the banking system here. Many of our clients have trouble doing simple things such as foreign currency transfers. For this reason, we always recommend opening an offshore bank account with Internet transaction facilities. Then, of course, there is the question of regulation. This is not a regulated market for the offshore business and if you are dealing primarily with the foreign community. As a result, there a many small sales offices operating with one or two people who do not work with the same code of ethics as ourselves. These operations give the layman a negative impression of the whole industry and such clients need a lot of convincing to try someone better. How do you see your industry changing in the near future, and why should companies look to you for opportunities? Alan Smith: We expect that the Japanese government will continue its program of de-regulating financial markets which will ensure wider access to global investments for investors based here. Towry Law International Japan is uniquely placed as we are able to advise on both onshore Japanese products through sister companies within the AMP group, combined with our range of over 1,400 offshore funds and international tax planning experience. How do you approach and guide your clients? Alison Pockett: Unlike many other IFAs we do not regard ourselves as just selling investments. We provide a full financial planning service conducting a thorough review of a client's future intentions and financial goals. Lastly, what advice would you give someone looking for financial planning advice for the first time? Alison Lockett: Talk to friends and ask them to recommend someone. Once you have received a proposal after meeting an adviser, always ask why they recommended what they did and what other alternatives they considered. This will test them and make you feel comfortable that you are dealing with someone who knows what they are talking about. n

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