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Split-cap fund firms in move to cut fees

Some of the most distressed split-cap trusts moved to put the brakes on the crisis this week by cutting or waiving their annual fees.

The move comes in response to AITC director general Daniel Godfrey&#39s letter to split trust chairmen this month, suggesting that trusts try to cut costs to stem the problems.

Aberdeen Asset Management led the move, waiving fees on its high-income trust at the end of last week while BFS Investments and Martin Currie have cut the fees on their geared income and high-income funds. Aberdeen says it is in talks with the boards of several other of its splits to cut or waive fees. Jupiter, Exeter, and Gartmore also say they are in similar discussions with the boards of their splits.

Five more trusts suspen-ded dividends last week, with analysts now predicting a slowdown in corporate activity within the sector.

Aberdeen marketing director of investment trusts Piers Currie says: “Repairing shareholder value for these funds is the key focus of our activities at present. The initiative we have taken over management fees is one of many we are taking in order to rebuild confidence in the sector. It is a clear, unambiguous indication of our commitment to restoring the health of this dynamic sector of the market.”

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Three questions for employers…

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