Lombard Odier and Algebris launch a fixed income fund

Lombard Odier & Co has expanded its open architecture platform PrivilEdge with the fund PrivilEdge – Algebris Financial Bonds, an active management strategy that primarily invests in debt of bank capital structures, with a focus on Europe.

The goal is to offer high returns and moderate capital appreciation in the medium and long term, providing diversification and improving risk-adjusted returns compared to a euro investment grade credit allocation.

Strategy and market context

The fund focuses on large global banks and leading national entities that operate under the most demanding regulatory capital requirements. It combines the creditworthiness of the issuers with a low turnover approach and selective exposure to AT1 bonds.

In recent years, European banks have strengthened their credit quality and profitability: CET1 ratios are at cyclical highs, with an average of 14.2% in Europe, while non-performing loans are at cyclical lows.

Management team

The strategy is managed by Algebris, one of the fastest-growing asset managers in Europe and specialized in European financial institutions. Based in London, the firm was one of the first to invest in AT1 bonds and brings extensive experience in investment grade bonds, lower tier 2 and senior. The team dedicated to the fund consists of six investment professionals with an average of more than 18 years of experience.

The new strategy offers share classes with net asset value (NAV-hedged) coverage in US dollars, Swiss francs and British pounds, to meet different currency needs.

PrivilEdge is designed to offer our clients access to some of the best investment strategies available. The incorporation of this financial credit investment grade strategy into the platform complements our existing offer and provides an additional diversification tool. Algebris' experience in this credit segment makes it the ideal partner.

Maxime Perrin, Head of Open Architecture at Lombard Odier

We are delighted to partner with Lombard Odier in the launch of this new fund. This collaboration reaffirms our strong commitment to asset gathering in Swiss private banking and marks an important step in further strengthening our presence in the region.

Davide Serra, founder and CEO of Algebris Investments