Greg Carlson: [Janus Overseas] also owns some key positions in European financials. Obviously, these were a big source of underperformance in 2011. Some of those have turned around in 2012. Can you touch on one or two of those?
Brent Lynn: Yes. The European financials have been a somewhat controversial sector because clearly they are at kind of the center of some of these sovereign balance sheet problems that the European countries have. They hold some of the European sovereign bonds, and they are just being in the middle of what is perceived as financial turmoil.
But what we've tried to do is focus on the individual companies and focus on their individual competitive advantages and opportunities. And we believe that our investments in companies like BBVA, like BNP Paribas, like Deutsche Bank, these are really national champion banks. These banks have strong balance sheets. They have few of the liquidity problems that have faced some of the other banks broadly in Europe, and we believe that they are long-term winners in this industry. Longer term, they will gain market share in their countries.
And BBVA, while certainly it has suffered from some of the asset-quality problems in Spain and the fallout of the real estate bubble in Spain, nevertheless, BBVA has their arms around their asset-quality problems much better than sort of the vast majority of the other banks in Spain. If we take BBVA as just an example, less than a quarter of their business happens to be in Spain. The key reason we own a big position in BBVA is because they have incredible franchises in Latin America, particularly in Mexico, but also in other countries in Latin America. And we believe that the value of these franchises is not at all reflected in the stock price.
Carlson: And Deutsche Bank, can you touch on one? How much of their business is in Germany, which is obviously still considered a bit stronger financially than [other countries in Europe]?
Lynn: Yes. So, Deutsche Bank has a strong core German sort of banking business. And in addition, we believe that they are one of the long-term winners in the investment banking area. Because of difficulties, a number of players in the industry have either dropped out or reduced the size of their investment banking business. And the strongest will survive, and players like Deutsche Bank we think will be one of the key beneficiaries of the fallout in this industry.
It's been a bit tough over the past few years, but longer term, we think that Deutsche Bank can have actually strong returns in investment banking. The need for investment banking in Europe and globally is not going to go away. Companies still will need capital, capital needs to be distributed, and investment banking will be a meaningful business we believe for a long time to come. And we think especially as a German national champion, Deutsche Bank is in a good position.
Carlson: All right. Well, listen, thanks very much for joining us today, Brent.
Lynn: Thank you very much, Greg.