Aberdeen “working to achieve a slowdown” in EM inflows

Slow down-signAberdeen Asset Management saw its assets under management rise by £6.2 billion (€7.4 billion) to £193.4 billion in the three quarters to December 31, 2012.

Net new business for the quarter was £1.1 billion, but Martin Gilbert, chief executive officer, conceded “the economic problems of many developed world countries are likely to remain a challenge for growth and markets for some years to come”.

While the latest interim statement suggests continuity, the asset manager has been more vocal about the fact that it is seeking to limit the inflows into its global emerging market equities range to protect performance.

“Net inflows to emerging market equities have continued at a higher rate than we are comfortable with and we are working to achieve a slowdown to ensure performance is not compromised,” the statement says.

A spokesman for Aberdeen adds that the overall global emerging market equities strategy has reached £36 billion and flows have been “too strong”.

The segregated business has already been closed as a result. Aberdeen has also stopped promoting the range and requested to have funds removed from buy lists.

When asked about closing the funds to new investors, the spokesman says Aberdeen is “not ruling anything out” and the long-term aim is to limit flows to $2 billion (€1.5 billion) per year.

“Flows into our equity products have remained strong, with our Asia Pacific product having been particularly popular in the latest quarter.”

Aberdeen says higher margin pooled funds investing in both equities and bonds continued last year, while outflows were mainly from lower margin segregated portfolios.

The effect on revenue is positive, with the net flows for the quarter adding approximately £30 million of annualised fee income.

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