Aberdeen Asset Management sees outflows of £10bn

Aberdeen Asset Management has posted a latest trading update showing assets under management have dropped as outflows hit £10.5 billion.

A sovereign wealth fund and UK wealth manager withdrew a combined £4.2 billion from active equity strategies and a further £2.2bn was lost as a result of the rationalisation of its US fixed income business.

The company’s assets now sit at £302.7 billion compared to £312.1 billion at the end of the last quarter.

The net outflows were partially offset by £3.3 billion asset appreciation with fixed income the only asset range to take a hit from market performance and currency losing £900 million.

Overall assets grew in the alternative and quant strategies while multi asset AUM remained flat.

However, positive performance was unable to offset outflows in equity and property strategies.

Martin Gilbert, chief executive of Aberdeen, said: “Investor sentiment had been improving steadily in the early part of the quarter, but stalled following the US presidential election result with investors putting asset allocation decisions on hold. Encouragingly, despite the market volatility our equity strategies produced strong returns for the year.”

“While growing interest in a number of our strategies is likely to continue to be masked, in the short-term, by significant withdrawals by a small number of clients, I am encouraged by the progress being made. Overall Aberdeen remains in good shape, we have a strong balance sheet, a global client base and wide range of capabilities to meet the needs of investors.”

In the US fixed income business the company is withdrawing from US core and core-plus mandates to focus on US credit and total return strategies. It expects this move to deliver a further £1 billion hit in the early part of 2017.