BBY Ltd. plans to double the number of staff in its unit catering to individuals this year, seeking to boost revenue from Australia’s A$1.6 trillion ($1.4 trillion) retirement savings industry.
“The fastest-growing headcount in our firm will be in the private client advisory area,” Glenn Rosewall, Sydney-based executive chairman at BBY, said in a phone interview yesterday. “We could double the size of our team and that’s something we would like to see happen this year.” Of the 180 staff at his firm, about 110 are advisers to individual investors, he said.
BBY’s expansion comes after Australia’s benchmark S&P/ASX 200 Index (AS51) reached a five-year high in October and companies raised A$20.2 billion through share sales last year, the most since 2009. The nation is home to the world’s fourth-largest pool of retirement savings, which will more than double to A$4 trillion by 2023, according to Deloitte LLP.
Individual investors are putting more of their pension money into the stock market after equities rallied and amid the revival in initial public offerings, according to Rosewall. The ASX 200 has a current dividend yield of 4.4 percent, according to data compiled by Bloomberg. Fixed-rate deposits at lenders paid average annual interest of 3 percent last month, central bank data show.
BBY is helping to manage the IPO of Staples and Agricultural Global Beef Investment, which is seeking to raise A$70 million, Rosewall said. Due diligence on part of the sale was delayed and the firm is aiming to have a prospectus by the end of this week or early next month, he said. BBY was founded in 1987 and processes an average of A$2.1 billion in turnover through ASX Ltd. per month, according to its website.
Rosewall forecasts the S&P/ASX 200 will provide a total return of about 10 percent when including reinvested dividends this year. Earnings will grow 8.3 percent in 2014 and 18 percent the following year, according to BBY estimates. The S&P/ASX 200 Accumulation Index, which includes payouts, climbed 20 percent in each of the past two years.
“The economy is not booming and there are going to be pockets of weakness,” Rosewall said. “We really need to see earnings coming through.”
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