Episode 178: Opportunities from Bank Dislocation with Matt Bass, Head of Private Alternatives at AllianceBernstein

Welcome to another edition of the InsuranceAUM.com podcast. I'm Stewart Foley. I'll be your host. Today's topic is investment opportunities driven by US bank disruption, and we're joined today by Matthew Bass, head of private alternatives at AllianceBernstein.

The US Insurance Investing Landscape: Midyear 2023 Check-In

The themes range from macro considerations to investment trends and regulatory developments. Our overarching view? A reshaped opportunity set calls for a selective approach and taking risk in a disciplined way. This perspective hasn’t changed, especially with questions surrounding the future macroeconomic picture and a fair amount of volatility.

How Insurance Investors Can Adapt to a Low-Liquidity World

Lower bond-market liquidity and insurance investors' unique needs raise the stakes for liquidity management in what's likely to be a volatile environment. The responses should be multifaceted: reviewing liquidity profiles and private-market allocations, tapping supplemental liquidity sources, and ensuring that investment capabilities can find liquidity at the ground level in public markets.

Systematic Fixed Income Investing Comes of Age

Leading active fixed-income managers have long sought to make their investment performance outcomes more consistent and repeatable through process improvements. These enhancements have typically systematized aspects of the investment process without substantially altering the main sources of outperformance or reducing the levels of beta risk.

US Commercial Real Estate Outlook: Seeking Calmer Waters in Quality

The COVID-19 pandemic upended the way we live and work by creating secular changes and accelerating trends that were already afoot. For investors in commercial real estate, the results have been mixed.

Unlocking the Investment Potential of “S” in ESG: The Key? More Research and Data on Social Issues

Social issues are perhaps the most difficult to research and least understood by investors with an environmental, social and governance (ESG) focus. But the risks and opportunities they represent are growing, and investors need a way to step up to the challenge.

Has the Market Reshuffled the Public-Private Mix for Insurers?

A vastly different market environment in 2022 has dramatically reshaped the balance of insurance investors’ relative opportunities across public and private capital markets. This shift may create a pause in the growth of private allocations for some insurers as they reassess prospects. However, we don’t expect the long-term trend of growth in private allocations to change.

Emerging-Market Debt Outlook 2023: A Shifting Balance of Risks

Financial markets offered few opportunities for refuge in 2022, and emerging-market bonds were no exception. We expect the past year’s difficult conditions to gradually unwind in 2023, but risks remain, and investors will need to be selective.

1Q:2023 Strategic Investment Outlook: Four Strategic Allocation Issues for Asset Owners in 2023

The Fed’s current actions impact inflation over the next one to two years, not the next decade, and we continue to believe that long-term equilibrium inflation will be higher, given that the post-pandemic era represents a new regime. Different long-term forces are at work on inflation—notably deglobalization, demographic changes and environmental, social and governance (ESG) considerations. It will take a lot of work from investors to adjust strategic asset allocation to a higher-inflation world.

The Tide Grows Stronger for Insurers and Climate Scenario Analysis

Regulatory momentum is building globally around identifying and managing insurance companies’ exposures to climate risks, with scenario analysis considered a key tool. Because climate scenario modeling is a nascent industry, insurers and investment managers play important roles in advancing its deployment and effectiveness.

Shifting Commercial Real Estate Dynamics Create Debt Opportunities

The world is in a period of quantitative tightening, as central banks continue normalizing their balance sheets. This process, combined with official rate hikes, is pushing interest rates up and suppressing economic growth, which hurts capital value and poses challenges to real estate companies in implementing their business plans. At the same time, inflation remains high.

Inflation Reduction Act Could Be a Game Changer for Clean Energy

The US Inflation Reduction Act (IRA), signed into law on August 16, 2022, includes a substantial spending allocation to promote the development of clean energy, which will likely be a big boost for both this market and investment opportunities. Two of AB’s investment experts share their initial thoughts on this landmark legislation.

What Insurers Need to Know About the NAIC Proposal on Securitized Assets

Recent proposed rule changes from the National Association of Insurance Commissioners (NAIC) could alter the regulatory treatment of securitized assets—long a staple of US insurance companies’ core portfolios. It’s crucial for asset allocators to understand the potential magnitude, direction and timing of the first significant changes since 2008 as they consider portfolio positioning.

Private Credit 4Q21 Update: Entering 2022 on the Heels of a Strong Year

How Green Bonds Will Fund a Green Future

2022 Insurance Playbook: Volatility Could Present Repositioning Opportunity

Emerging-Market Investors Can't Afford to Ignore ESG Factors

Middle Market Direct Lending’s Illiquidity Premium Shines in Current Market

Cutting the Gordian Knot: How ESG Integration Can Help Solve Challenges to Investing in Emerging-Market Corporates

Making Sense of ESG Bond Structures

Protecting the Amazon by Investing in Brazilian Beef

Is The Market Too Pessimistic On Transitional Lending?

For Insurers The Fallen-Angel Wave Is A Call For Flexibility

Private Placements: Advantages Magnified In Late-Cycle Environment

The private placement market offers additional risk reduction and diversification that can help investors at any stage of the economic cycle. Private placements have more robust covenant packages and better recovery rates than public bonds—as well as higher yields. As credit markets face late-cycle headwinds, better downside protection and lower risk become especially attractive to insurers.

The Whys and Hows of Investing in Emerging-Market Corporate Bonds

The Future Of Fixed Income: How Technology Will Revolutionize Asset Management

Fixed-income investing hasn’t kept up with the rapid pace of technological innovation in the rest of the financial industry. But that’s about to change. Machines will empower humans to achieve unique insights and act faster in a market where speed and alpha are inextricably linked.

EM Debt Investing: Considering the Right Approach

Emerging-market (EM) debt’s strong returns and outlook have attracted flows from wide-ranging investors. Insurers calculating the expected returns of EM debt subsegments must adjust for the cost of capital, so that they can fairly assess opportunities versus other investments in their asset allocations.