A review of funds triggered by falling profitability or other critieria could help the fund management industry consolidate its product and save costs
James Charrington, Emea chairman of BlackRock, raised the idea at a CEO roundtable at Fund Forum International in Monaco this morning.
"I would like to see some form of criteria, perhaps falling profitability, scale... or some other criteria, whereby funds go into a process of review when they cross a certain point."
The panel - chaired by Mark Tennant of Bluerock and also featuring Elizabeth Corley, CEO, Allianz Global Investors Europe, and Jamie Broderick, CEO, JP Morgan Asset Management Europe - discussed ways to make asset management more efficient in light of findings from a 2010 IBM survey such as the fact that $300bn (€210bn) in fees were spent on investment managers who failed to beat their benchmark.
Asked by Charrington what the barriers were to such a review, Corley said tax and the fact that, as of July, fund mergers will have to be consulted on under the Ucits IV Directive.
Broderick said product delivery costs could probably be lowered with multi-asset, target date vehicles.
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