What is your strategy in Europe?
- Charles Brady:
We have $260 billion under management, of which $50 bn are managed for international clients, essentially in Europe. It's still a minority compared to our US business, but it has more potential. We're celebrating our first ten years in France and showing our continued commitment to the euro and the European Union by choosing a French listing.

Why did you want to be listed in Continental Europe? Why did you choose Paris?
- Charles Brady:
Being listed in Europe is not only a marketing thing. We don't need to raise capital but we need to have a listing in euro. We chose Paris as a proxy to the Continental market because ultimately all European exchanges are electronic and will be linked. Regulation will follow, it's not a problem. We have to get listed in euro to be in the Euro top 500 companies, which we deserve to be because all FT 100 companies are among the 500 largest European market capitalisations. We're already number 73 in the Footsie and we've been ranked with the strongest performance of all Footsie stocks in 1997.

What lessons did you learn from your French experience?
- Charles Brady:
Invesco France, our French subsidiary, has gathered FRF 10 billion of assets under management. We have to be local. We haven't had local products from the beginning. We learnt by experience and we learned it the hard way. But we've understood. Now we've been here for ten years and we'll be here for more decades in the future. A very important thing in our success has been to have a local board of directors. They have insights in the market and they gave us the support we needed to carry on.

What are your expectations for the European Asset management market?
- Charles Brady:
I'm very enthusiastic about the European mutual funds market, he said. The Continental market has even more potential than the British market. I'm both optimistic for retail and institutional activities. Retail is easier, because individuals are shifting to more long term investments as they see interest rates falling in traditional savings accounts, like in France where these rates are fixed by the government. They realise that other investments don't reward them as they used to and they look for more performance. We sell products that fit these needs.

What are your perspectives in the institutional market?
- Charles Brady:
The institutional segment is more difficult. We're not to the point of building up teams in that area. Many countries have difficulties to overcome their fears of social unrest when they will reform their pension systems. Italy has not implemented its reform and France has repealed it's first pension law. It will be difficult but it will come. We've been saying that for the last ten years and nothing has happened yet. But the more they wait the more their pension systems will need to be reformed to face their growing liabilities.

Which are the most promising European markets?
- Charles Brady:
It's difficult to see which European country is the most promising market for the moment. We have to wait for some reforms to be enacted. We are in the starting blocks. We need to have local distribution. If you ask me within Europe which markets are the most promising surprisingly it may be countries in Eastern Europe like Poland, Hungary, the Czech Republic or Romania. These countries don't have to break their old pension systems and to overcome local resistance because they simply don't have any sound pension system. They need to build up capital in their countries and to fund their pension liabilities. So they look very closely at the Chilean model and they will probably come with pension funds reforms and systems sooner than Western Europe. Ultimately it will trigger a reaction by Western European countries willing to catch up with their eastern neighbours and to tackle their own pension systems.

Gilles Pouzin