Aberdeen saw GBP1.5 billion walk out of the door of its property funds in the three months to the end of June, according to a trading statement released this morning (Monday).
The outflows and market uncertainty following Brexit caused Aberdeen to temporarily suspend dealing in its UK property fund, and adjust prices down significantly.
The fund manager also saw net outflows across the remainder of its asset classes, totalling GBP8.9 billion. Withdrawals from the property sector represented the largest outflows as a percentage of assets under management, though these make up a relatively small part of the overall business mix.
Despite fund outflows, assets under management rose over the quarter from GBP292.8 billion at 31 March 2016 to GBP301.4 billion at 30 June 2016. This was a result of positive market movements and favourable exchange rate movements, with Sterling weakening against most major currencies.
Laith Khalaf, senior analyst, Hargreaves Lansdown, says: ‘The exodus from the property sector took its toll on Aberdeen over the last quarter, though the silver lining from the Brexit vote is that weaker sterling has helped drive an increase in the group’s assets under management.
“For Aberdeen outflows from the property sector are a bit of a sideshow, as withdrawals are taking place across the board. At the moment for or every GBP1 in assets Aberdeen is attracting, GBP2 is walking out of the door, and that’s not sustainable for a fund manager in the long term.
“The latest quarter did see some moderation in the pace of withdrawals from Aberdeen’s equity funds, though it’s difficult to get too excited by this when that still equates to over 3 per cent of equity assets lost in just three months.
“Aberdeen is undoubtedly home to some talented fund managers, particularly in its emerging markets franchise, but the business is facing a challenging period at the moment.
“Fund outflows are part and parcel of asset management, from time to time, but Aberdeen will be hoping that before too long they start to see some ebb, as well as flow."
