La Trobe Financial’s winning formula

CEO Chris Andrews talks about how he plans to take the business’s reputation as Australia’s premier alternative asset manager to new heights. 

It has been a busy few years for Chris Andrews. After stepping into the CEO role at La Trobe Financial in 2022, the business has continued from strength to strength, eclipsing $20 billion in assets under management.

“We have reached over 100,000 investors. Just our retail strategies alone have about $12 billion in assets under management, and over the last two and a half years, we’ve grown faster than we’ve ever grown,” says Andrews.

The company has also achieved a significant milestone by kickstarting a new international blueprint and unveiling a new US Private Credit strategy in response to the needs of its investors.

The La Trobe Financial US Private Credit Fund invests in the private debt of the US middle market through a portfolio comprising a majority of directly originated senior secured loans that have been strategically curated by La Trobe Financial’s first international partner, Morgan Stanley.

“We launched the product in December last year in partnership with the US Morgan Stanley team and their corporate private credit sectors targeting the mid-market. We wanted to give investors a way to invest in the rebuilding of the US middle market,” explains Andrews. “We already have $190 million in assets under management. It’s off to a great start.”

“The US mid-market is the world’s third largest economy, so it’s broad and deep and incredibly dynamic.”

Chris Andrews

For context, Morgan Stanley estimated earlier this year that the private credit market is US$1.5 billion in the US and predicts that figure could reach US$2.8 billion by 2028.

When asked if La Trobe Financial was going to create more international investment opportunities for Australians, Andrews replied: “The new product fits under what we call our La Trobe Global Asset Management Strategy. And we will be bringing new products to investors, which will be things that are perhaps a little harder for Australian investors to access.”

While it’s an exciting time for the business, Andrews remains focused on the cornerstone of La Trobe Financial’s offering – which he describes as transparency, reliability and a genuine understanding of investors’ goals.

“At La Trobe Financial, we have been building the wealth of our investors for over seven decades through careful attention to quality, discipline and consistency in performance. As we continue to grow and release new products, we will remain committed to service and stewardship,” Andrews adds. “And that we continue to do so with a human-centric approach.”

It’s a strategy that has fostered success locally. In particular, the flagship 12 Month Term Account, which has a mix of residential and commercial loans across Australia and boasts a return of 6.75%.

“The 12 Month Term Account has been going since 2002, so it’s been through the Global Financial Crisis, the COVID-19 pandemic and this recent upward cycle in interest rates, and no investor in it has ever lost a single cent of capital.

“It is now probably Australia’s number one retail investment strategy. It’s used by 4,000 advisors, but we also have investors coming to us directly, so it’s been incredibly successful.”

The notion of “private credit” might be hot in investment circles now. Still, Andrews explains, in 1989, when La Trobe Financial had the idea of matching private investors with mortgages, it was revolutionary. As pioneers in the alternative asset management industry, the business prides itself on its adaptability and stability.

“That’s the proposition. We focus very hard on the quality of the assets,” says Andrews. “If we manage that very carefully, are disciplined with our credit, and are disciplined with our liquidity, we build portfolios incredibly resilient to the ups and downs of the market cycle.”

The combination of innovation and a steadfast approach to generating consistent returns for its global network of investors has built La Trobe Financial into the business it is today.

“We believe in the power of alternative assets to generate consistent returns. Our track record speaks for itself, and we are confident in the resilience of our strategies throughout market cycles.”

Andrews will be speaking at the Forbes Business Summit on 19 November 2024.