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F&C losses hit 29m

F&C Asset Management made a loss of 29.2m in the first half of this year after seeing significant institutional outflows.

The firm lost 2.83m in the same period last year.

Funds under management at June 30 were 107bn compared with 131bn at the start of the year despite strong retail market inflows which increased by 158 per cent. The majority of the outflows were down to Resolution Life taking back 20.1bn of funds to run them in house.

F&C also lost the management contracts of emerging markets and Latin American investment trusts and the firm is braced in the next quarter for the loss of two more institutional mandates for Dutch pension funds with combined assets of 2.5bn.

Despite the outflows, the group’s investment management fees were only slightly down at 130.7m compared with 131.1m.

The group says its profits were hit by an impairment charge of 44.8m relating to the loss of Resolution and other business and says the charge is due to accounts reporting adjustments under international financial reporting standards.

Communications direc- tor Jason Hollands says: “We saw 76m retail inflows in quarter one, which should be a peak for all asset managers because of the tax year end, but 89m in the second quarter despite the recent market volatility.”

Parent company Friends Provident’s total life and pension new business rose by 53 per cent to 89m from 58m while the firm’s total net margins improved from 2.7 per cent to 2.9 per cent.


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