F&C Asset Management reported a net outflow of assets in the fourth quarter after it was hit by the Portuguese government nationalising bank pension schemes.
At the end of December 2011 F&C said it had £100.1bn of assets under management (AUM), down from £103.2bn three months before.
The decline in AUM in the second-half of 2011 and difficult market conditions, particularly in the third quarter, would have an effect on management and performance fees compared to the prior year, F&C said.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The outflows came mainly from insurance funds and a £1.3bn institutional gross outflow from the BCP Pension Scheme after the Portuguese government decided to nationalise the past pension obligations of the country's largest banks.
The Portuguese government began a further withdrawal, representing £1bn of assets, in January 2012.
"We are currently not aware of any further withdrawals forthcoming from this nationalisation policy," F&C said.
Insurance and strategic partner net outflows also included £1.4bn withdrawn from a derivatives pool which was not covered under an exclusivity agreement and for which fees were earned on a transactional, rather than management fee, basis, the firm added.
There is another big withdrawal in the pipeline after Friends Life gave F&C 12-months notice of its intention to withdraw £2.3bn of assets, principally in respect of its annuities fund, in December 2012.
This come off the back off a recent announcement that Friends Life is to launch an in-house asset management subsidiary in the second half of 2012.
"These assets represent approximately £1.1 million of annualised revenues and the effect on current year revenues will therefore be minimal," F&C said.
Shares in F&C slid 2% in early trading following the announcement.
-
Are the wealthy dodging more tax than previously thought?A new report suggests tax non-compliance among the wealthy could be worse than previously imagined. Is an overly complex system partly to blame?
-
Six out of 10 retirees who accessed a pension didn’t use Pension Wise - how does the guidance service work?Many pension savers don’t bother using the free government-backed service Pension Wise. So, how does it work, and could it be useful for you?
