Aberdeen Asset Management (AAM) grew assets under management by nearly £9billion during July and August, beating the expectation of investment bank Goldman Sachs.
AAM’s said yesterday it benefited from a recovery in global equity markets in the period, but new business failed to make up for a £1.7billion outflow of cash from group funds.
After watching clients rush to the exit amid emerging market volatility earlier in the year, the Granite City-based fund manager said sentiment had improved enough to help lift assets to £331.2billion, from £322.5billion on June 30.
A better investment performance boosted the total by £7.9billion, with foreign exchange effects adding a further £2.5billion.
The pace of money leaving AAM funds slowed substantially from the £8.8billion outflow seen in the three months to June 30, with the group citing “a more stable tone in global stock markets – in contrast to the volatility
which characterised the first half of our financial year.”
Finance director Bill Rattray told the Press and Journal the improvement in investor sentiment was encouraging but “macroeconomic issues on the go” caused more volatility in September.
AAM’s latest trading update came ahead of results for the full-year to to September 30, which are due on December 1.
Chief executive Martin Gilbert said: “Our equity capabilities are recovering, both in terms of performance and flows following a tough 2013.
“It’s also encouraging that our marketing focus on non-equity products is gaining traction, particularly in terms of
property and emerging market debt.”
Mr Gilbert said AAM had made “significant progress” over the past year, thanks to the acquisition of the Scottish Widows Partnership Group (Swip) and related private equity and infrastructure fund management businesses from Lloyds Banking Group in a deal worth about £550million.
He added: “Our enhanced fixed income, property and solutions capabilities, combined with our historic strength in equities, mean we are well-placed to meet the future needs of investors around the world.
“With the Swip integration on track, we remain confident that the increased scale and breadth of the group’s business provides a solid foundation to weather what are likely to remain volatile markets.”
AAM’s takeover of the Swip and other business from Lloyds earlier this year made it Europe’s biggest fund manager and gave it a springboard for challenging bigger rivals in the US.
Goldman Sachs said the latest assets under management total was 2% ahead of its forecast for £326billion,although the overall results were broadly in line with expectations.
AAM also announced that Anita Frew, its senior independent director, would step down from the board at the close of business today.
The firm is already conducting interviews to identify a suitable replacement for Ms Frew, who has been in its executive team for 10 years.