In 2008, Nuveen Investments wrestled with the freeze-up of the auction-rate preferred securities market and sought to restore liquidity at par to preferred shareholders and to reduce the expected cost of leverage over time for common shareholders.
As of October, Nuveen says, it had refinanced $2.7 billion in ARPS issued by taxable closed-end funds using a variety of conventional debt-financing alternatives and proceeds generated from fund portfolio transactions. Also, Nuveen's leveraged municipal closed-end funds refinanced $1.5 billion in ARPS issued by tax-exempt funds using tender-option bonds and variable rate demand preferred securities, a new form of preferred shares.
"Overall, Nuveen Investments got a lot of positive momentum from how we handled everything, and our advisor partners were proud of how we handled this," explains Alan Brown, executive vice president and co-head of Nuveen Investments Global Private-Client Group. "So overall, it had little impact on sales flows. We are one of a few firms to see positive flows [in 2008] in fixed-income and equity."
The company addresses the general anxiety in the marketplace by working with advisors to help them build solid, well-diversified portfolios for clients. "People went to short-duration bonds or limited-term municipal bonds," Brown says.
"And people look to us, as we've been around 100 years, and our brand for certain attributes, namely conservatism, trust and integrity."
The firm has 70 funds in total, of which 30 focus on fixed-income.
"The severity, depth and breadth of the current crisis affect everyone," he explains. "We are very committed to our customers going forward. We have hunkered down to follow our strategy."
Part of that strategy includes broader efforts by the team of six staff in the wealth-management group, which focuses on education and practice management. "It's been a big investment for Nuveen over the past three to five years," says Brown. In addition, the firm relies on 40 field-based advisor consultants.
"We want to be client-facing, in front of advisors as much as possible. This supports the trend we are seeing in the marketplace, which is back to basics.
"And we want to be there with the right products, services and ability to help advisors construct these positions."
To boost its ability to do just that, Nuveen recently announced plans for its eighth acquisition of an affiliate, Winslow Capital Management. Minneapolis-based Winslow, which has some $4 billion in assets under management, specializes in large-cap, growth-stock portfolios. Chicago-based Nuveen had some $130 billion in AUM as of September 30, 2008.
Janet Levaux, MBA/MA, is the managing editor of Research; reach her at email@example.com.