Asset managers came back fighting in 2009 as assets rose 16% to US$62trn (€44.5trn), compared to a 23% loss the year before, with the large firms benefiting the most from the rebound. However, asset levels are still below those seen in 2006.
Research from consultancy Towers Watson showed that larger firms were the major beneficiaries of the rebound with BlackRock coming out on top, followed by State Street and Allianz. The consultant found that the percentage rise in total assets under management in 2009 was the second largest since the research began in 1996.
The research, conducted in conjunction with Pensions & Investments, revealed that the top 20 managers' share of total assets increased from 38% to over 40%. It also found that, by number, bank-owned asset managers continue to dominate the top 20, although the number of independent managers in the group grew. There are twelve US-based investment managers in the top 20, up from ten the year before, managing 63% of these assets, up from 51%, while the other eight managers are all European-based.
Some of the managers that gained most by rank over the past five years include BlackRock, having moved from 41st place to first, BNP Paribas, from 33 to 7, Crédit Agricole, from 24 to 12 and Legg Mason from 37 to 18.
Furthermore, Towers Watson found that over the past five years only half of the fastest growing firms have done so in a primarily organic way, with the other half doing so by merger or acquisition.
Carl Hess, global head of investment at Towers Watson, said: "The larger firms were the main beneficiaries of the rebound and increased their share of total assets to the highest levels since the research began. Market returns, new inflows, performance fees combined with reduced overheads will have eased the pressure on asset management firms bringing most of them back into profitability."
Assets held in passive products also grew consistently, which may have had a hand in bumping BlackRock to the top spot. This was the first time the firm’s passive assets were included in the research and as a result of its merger with Barclays Global Investors, BlackRock has now overtaken State Street as the largest passive manager.
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