As well as adverse market conditions, the company cites corporate uncertainty as a potential reason for a delay in delivering its three-year plan to bolster the business.
Earlier this year, 52 per cent shareholder Friends Provident said it no longer sees F&C as part of its revised strategy.
Only F&C’s international wholesale mutual fund business division saw assets under management increase in the first quarter.
UK retail assets under management fell from £3.3bn to £3bn in Q1. However, gross sales of UK retail funds rose by 12 per cent to £168m in Q1 2008 from £150m in Q1 2007. There was a £600m fall in investment trust assets to £6bn.
Chief executive Alain Grisay says: “We have a clear strategy and, against the backdrop of volatile markets and investor uncertainty, we have continued to demonstrate strong progress in our higher-margin retail and wholesale businesses in line with that strategy.
“In the institutional market, while we continue to win new business, our sales are being affected in the short term by the current period of corporate uncertainty.”