F&C saw assets drop ahead of independence
EUROPE - F&C Asset Management executives have admitted drumming up business was difficult in 2008 while its ownership was in question but hope the firm’s status as a soon-to-become independent entity will boost its business potential over the coming months.
Details of the firm’s preliminary results for 2008 revealed its assets under management fell by under 5% last year from £103.6bn to £98.6bn, held largely by its fixed income exposure and management of euro-denominated portfolios, while its net revenue dropped from £264.5m to £229.9m in that time.
More specifically, Alain Grisay, chief executive of F&C Asset Management, said with uncertainty over its ownership coming to an end - after its major shareholder Friends Provident last year confirmed it would redistribute its 52% share to the F&C base - he was “confident about the future” of the firm once it becomes an independent listed offering.
Robert Jenkins, chairman of the F&C, also said “the question marks surrounding the shareholding inevitably had some adverse impact on our asset gathering efforts, and therefore new revenue generation”.
That said, F&C did generate £2.4bn in new institutional business last year, over half of which came through in the fourth quarter.
The report also stated it “outperformed” on 62% of its equities managed and 46% of fixed income portfolios, though some of its more actively-managed high alpha strategies were “severely constrained” by market conditions and only two out of three single strategy hedge funds delivered positive absolute returns.
Elsewhere within its reporting, F&C said its own defined benefit pension fund has a deficit of £21.8m - though this is an improvement on 2007 - as the fund has liabilities of £167.9m compared with £177.4m in the previous year.
And on a complete different note, F&C has also revealed it is been granted a fresh tribunal hearing in defence of claims made by former employee Gill Switalski.
Formerly a lawyer at the firm, Switalski had earlier had her claim for £19m in compensation upheld against her former employers for alleged sex discrimination, harassment and victimisation at work.
F&C submitted fresh findings against five claims upheld against the firm at an employment appeal tribunal in November 2008, and will now have the five claims re-heard by a new tribunal this year “as a result of fresh evidence supporting the company’s position”.
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