Scott Grimberg, a longtime portfolio manager at the California Public Employees’ Retirement System, is leaving the $473.57 billion pension fund to launch a new fund at Itaú Asset Management.
Itaú is Latin America’s largest private fund manager, with $165 billion in assets. Institutional Investor has learned that Grimberg will lead a new fund and team that will be focused on fixed-income in emerging markets. “I’m excited by the opportunity to create an institutional structure [that builds] on what Itau has already put together,” Grimberg said via Zoom. “We want to provide the kind of returns needed not only by large institutional managers, but also by smaller institutions, which have had a lot of trouble accessing these markets.”
Grimberg had been with CalPERS since 2013, where he worked as a fixed-income senior manager for emerging markets. His previous experience includes emerging markets fund roles at Bank of America, BNY Mellon Asset Management, and Nuveen.
At Itaú, Grimberg will be charged with building a fixed-income emerging markets fund and team aimed at institutional investment clients, a task that he feels couldn’t have come at a more opportune time. “The work I’ve done so far and in the past year at CalPERS [has involved] looking at the broad opportunity available in the emerging market universe,” Grimberg said. “As you probably are aware, CalPERS is now opening up to a much broader footprint in these markets. We think this is something we’ll see more in the institutional marketplace.”
Grimberg noted that in emerging markets, gross domestic product is expected to grow more sustainably in the long run compared with developed countries, making it an attractive strategy for long-term investors. “We have to look at emerging markets essentially as coupons,” Grimberg added. “By nothing happening, we’ll collect on risk premia. It’s not a matter of having the highest possible returns. It’s about avoiding the disasters that inherently can come up.”
In Grimberg’s view, these securities also have an ESG component. “Investing in these countries and helping them grow and develop increases global ESG improvement,” he said.
The new fund — an emerging market dollar fund product — is on track for an April launch, Grimberg said. He added that the organization hopes to launch a second local market bond product later this year.
Although Itaú has long operated in Latin America, the firm has been beefing up a team that will focus specifically on emerging markets in other areas of the world. In August, the company hired Raphael Kassin to lead another emerging markets bond strategy. In September, Itaú hired Luiz Soares to head up its emerging markets equities strategy.
“Our target is really to become a key player in the emerging markets,” said Charles Ferraz, chief executive officer of the company’s U.S. business. “That’s where we’re heading.”
