Columbia Threadneedle to transfer funds to Luxembourg ahead of Brexit

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Columbia Threadneedle Investments plans to transfer assets from UK-domiciled funds to its Luxembourg range ahead of the UK’s exit from the EU.

The asset manager will launch 13 new funds in its Luxembourg SICAV vehicle to accommodate the transferring assets, it said in a statement on Wednesday. In total, 20 UK-based funds will see assets move to Luxembourg.

All transfers are subject to approvals from investors and the UK and Luxembourg regulators. Affected investors will be contacted between now and September.

The group did not put a figure on the amount of money expected to move, but a spokesman said European clients in UK-based pooled funds “account for a very small percentage” of Columbia Threadneedle’s global assets – roughly 2%. The affected funds together are worth roughly €28bn (see below).

According to IPE’s 2017 Top 400 Asset Managers report, the company ran €432bn worldwide at the end of 2016, including €63.5bn for European institutional clients.

Michelle Scrimgeour, CEO for Europe, the Middle East and Africa at Columbia Threadneedle, said: “Our priority is to provide certainty and continuity for our clients. By facilitating the transfer of European customers to our existing Luxembourg range we will ensure they can continue to access our best investment strategies in a UCITS-compliant fund, regardless of the final agreement between the UK and the EU.

“For EU investors, the transfers will remove uncertainty regarding the future status of their investment in their home country.”

In June last year, M&G announced similar plans to move €7bn worth of assets from its UK-based funds to its Luxembourg fund vehicle to safeguard its non-UK investors.

Affected Columbia Threadneedle funds

UK-based fund	Size	Luxembourg-based fund	Size
Threadneedle American Fund	£2.2bn	Threadneedle (Lux) – American	$230m
Threadneedle American Extended Alpha Fund	£169m	Threadneedle (Lux) – American Extended Alpha	New fund
Threadneedle American Select Fund	£1.1bn	Threadneedle (Lux) – American Select	$9.4m
Threadneedle American Smaller Companies Fund	£641m	Threadneedle (Lux) – American Smaller Companies	New fund
Threadneedle Asia Fund	£599m	Threadneedle (Lux) – Asia	New fund
Threadneedle Credit Opportunities Fund	£1.9bn	Threadneedle (Lux) – Credit Opportunities	New fund
Threadneedle European Corporate Bond Fund	£169m	Threadneedle (Lux) – European Corporate Bond	New fund
Threadneedle European High Yield Bond Fund	€726m	Threadneedle (Lux) – European High Yield Bond	New fund
Threadneedle European Select Fund	£3bn	Threadneedle (Lux) – European Select	€32.9m
Threadneedle European Smaller Companies Fund	£2.2bn	Threadneedle (Lux) – European Smaller Companies	New fund
Threadneedle Global Emerging Markets Equity Fund	£326m	Threadneedle (Lux) – Global Emerging Market Equities	$4.6m
Threadneedle Global Equity Income Fund	£1.6bn	Threadneedle (Lux) – Global Equity Income	New fund
Threadneedle Global Extended Alpha Fund	£261m	Threadneedle (Lux) – Global Extended Alpha	New fund
Threadneedle Global Select Fund	£1.2bn	Threadneedle (Lux) – Global Select	New fund
Threadneedle Pan European Fund	£252m	Threadneedle (Lux) – Pan European Equities	€64.7m
Threadneedle Pan European Equity Dividend Fund	£63m	Threadneedle (Lux) – Pan European Equity Dividend	New fund
Threadneedle Pan European Smaller Companies Fund	£1.6bn	Threadneedle (Lux) – Pan European Smaller Companies	New fund
Threadneedle UK Fund	£2.1bn	Threadneedle (Lux) – UK Equities	£145.3m
Threadneedle UK Absolute Alpha Fund	£648m	Threadneedle (Lux) – UK Absolute Alpha	New fund
Threadneedle UK Equity Income Fund	£3.9bn	Threadneedle (Lux) – UK Equity Income	£78.4m