City National Bank Shifts Investment Strategies; Asset Management Division Adopts Market-Neutral Position in Industrial Sector, Reduces Corporate Bond Holdings for Managed Portfolios.LOS ANGELES -- City National Bank, the second largest independent bank headquartered in California, announced today that its investment management division, City National Asset Management, has decided to shift its overall investment strategies for managed stock and bond portfolios based on current market and economic conditions. Within its equity portfolios, the bank has decided to shift to a more market-neutral position in industrial issues from its previous overweighting in this sector. It also will be moving to a market weighting from an underweight Underweight An situation where a portfolio does not hold a sufficient amount of securities to satisfy the accepted benchmark of the portfolio's asset allocation strategy. Notes: position in the financial services and consumer staples Consumer Staples The industries that manufacture and sell food/beverages, tobacco, prescription drugs, and household products. Notes: Proctor and Gamble would be considered a consumer staple company because many of its products are household and food related. sectors. "We've been overweighting equities in the industrial sector of the market for the last year or so, given their relatively attractive valuations and strong earnings momentum," said City National's Chief Investment Officer Richard A. Weiss. "With the average return of industrial issues up more than 16 percent over that period, we have decided to adopt a more sector-neutral stance, reflecting our belief that growth rates are stabilizing in the overall economy." For fixed income portfolios, the bank will reduce its previous overweighting in corporate bonds relative to U.S. Treasury securities U.S. Treasury securities Interest-bearing obligations if the U.S. government issued by the U.S. Department of the Treasury as a means of borrowing money to meet government expenditures not covered by tax revenues. . "The corporate bond sector has significantly outperformed Treasury bonds since we put into place our overweighted position roughly a year ago," Weiss said. "However, renewed concerns about the rate of economic growth and corporate earnings are driving our current reallocation Noun 1. reallocation - a share that has been allocated again allocation, allotment - a share set aside for a specific purpose 2. reallocation back to Treasuries and Agencies." Weiss added that the bank will maintain the market-neutral position adopted at the beginning of this year for its balanced stock and bond portfolios. "While the specter of inflation, rising interest rates and high oil prices pose some significant threats to this recovery, we are not ready to move to a more bearish position and underweight stocks at this time." About City National City National Corporation (NYSE NYSE See: New York Stock Exchange :CYN CYN Canyon ) is a financial services company with $13.5 billion in total assets. Its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , City National Bank, is the second largest independent bank headquartered in California. As California's Premier Private and Business Bank(R), City National provides banking, investment and trust services through 53 offices, including 12 full-service regional centers, in Southern California, the San Francisco Bay Area “Bay Area” redirects here. For other uses, see Bay Area (disambiguation). The San Francisco Bay Area, colloquially known as the Bay Area or The Bay and New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. . City National is ranked among America's top companies in Forbes magazine's "Super 500" list. It also is one of the nation's top wealth managers, according to Barron's magazine. The company and its affiliates manage or administer more than $31 billion of client trust and investment assets. For more information about City National, visit the company's Website at cnb.com. Note to Editors: Richard A. Weiss, chief investment officer, City National Bank, is available for interview about the bank's shifts in its investment strategies, as well as the markets, economy and other factors that will continue to influence investment decisions in 2004 and beyond. |
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