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F&C institutional assets hit by pension outflows

EUROPE – F&C, which is being bought by ISIS Asset Management, lost almost four percent of its institutional assets under management in the first half of 2004.

F&C said in a statement today that it lost a net 1.1 billion pounds in institutional assets in the first half. This is 3.8% of the 28.9 billion pounds in institutional assets it had under management at the start of the period. It said it was affected by “outflows arising largely from underlying client activity within its pension and insurance portfolios”.

It added that asset inflows in the second half of the year were still being offset by outflows “mainly from multi-asset mandate reallocations”.

Total institutional AUM at the end of the first half was 27.2 billion pounds. F&C’s overall total AUM slipped three percent, or 1.5 billion pounds, to 54.9 billion pounds.

Total new business inflows were 4.2 billion pounds – which it said “included a number of consultant-driven mandate wins the UK and continental Europe”.

Under a deal announced in July, ISIS’s institutional business is to be incorporated into F&C’s institutional platform. A joint statement said: “F&C’s institutional investment philosophy and process will be extended to the assets of the institutional clients of the enlarged group.”

F&C executives said at the time of the announcement that clients’ initial reaction to the merger was “very, very positive”.

F&C said operating profits before exceptional items and long-term incentive costs rose 31% to 20.8 million pounds.

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