Fees rise for Baillie Gifford’s Shin Nippon

The news comes despite the firm announcing an effective fee cut in September.

The Edinburgh-based manager now charges fees of 0.95 per cent on the first £50 million of net assets in the trust followed by 0.65 per cent on the next £200m and 0.55 per cent on the remaining assets.

Before September it charged 0.95 per cent on the first £50m and 0.65 per cent on everything else.

The decision to reduce fees on the Japanese SME focused trust follows similar changes on the Baillie Gifford Japan, Edinburgh Worldwide and Scottish Mortgage trusts.

The most recent reduction has been in the fee charged for running the £1.3 billion Monks Investment Trust from 0.59 per cent per year to 0.45 per cent on the first £750m of assets and 0.33 per cent on everything over that.

The amount paid to Baillie Gifford is now expected to reduce by around £500,000 a year.

However, in the year to the end of January Baillie Gifford received £1.6m for running the Shin Nippon trust, up from £1.1m the previous year.

Trust chairman Neil Donaldson, who bought 234 shares of the firm’s stock on Friday, said the rise in management fee was “due to the uplift in net assets under management”.

An increase in dividend income “more than offset the negative effect of the increased management fee”, added Mr Donaldson whose shares were purchased at an average cost of GBX 640 ($7.95) per share, for a total transaction of £1,497.60 ($1,859.68).

Despite increasing from £163.4m to £233.9m during the year, the trust’s net assets did not meet the threshold for the fee reduction.

The trust’s net asset value per share rose by 34 per cent in the year to the end of January.