Dexia sees rise in institutional inflows
BELGIUM – Dexia’s institutional fund management business has seen increasing net in flows over the first nine months of the year.
Net inflows into Dexia’s asset management business over the third quarter totalled 1.5 billion euros. Over the first nine months, net inflows reached 3.7 billion euros, of which 2.2 billion euros was in institutional fund management.
In the Netherlands, however, assets under management remained stable at 4.5 billion euros at the end of the third quarter.
As of end September, Dexia had 24 billion euros in assets under management on the behalf of institutional clients (14.3 billion euros with mandates, and 9.7 billion euros of mutual funds commercialised to institutional clients).
The company said that Dexia Asset Management’s fund performance remains very good – 68% of funds are in the first two quartiles of league tables.
Within Dexia’s investment management services, results of the fund administration activities were described as “satisfactory”. Assets under custody grew 7.8% over the third quarter to reach 166.4 billion euros. This increase is partly explained by the signing of two new mandates – Robeco and CMI.
Revenues for the investment management services business, however, suffered over the first nine months, declining 11.6%. “This evolution largely comes from the decline in revenues in Dexia Nederland Holding (Dexia Bank Nederland and Kempen & Co), which dropped by 22.3% over the first nine months of the year compared to the same period of last year.
This is notably because the production of share leasing contracts stopped and the existing portfolio amortised. Besides, the stock market environment remained quite unfavourable for the equity-related activities (Kempen & Co),” says Dexia.
Despite a substantial decrease in costs in the third quarter (-10.0% to EUR 145 million) due to a cost reduction program, the gross operating income recorded an 8.6% decrease.
Over the first nine months, the gross operating income was down 16.6% (down 13.7% at constant exchange rate). In pure asset management, the gross operating income for the first nine months was 41 million euros, compared to 44 million euros for the same period in 2002. However, Dexia says, there has been an improvement in the gross operating income over the last three quarters.