Gam loses a fifth of assets as it blames ‘clear setback’ of fund manager’s suspension
Under-fire asset manager Gam lost around 20 per cent of its investment management funds in its latest quarter, as it struggles to make gains following the suspension of a portfolio manager.
Group assets under management fell from SFr 163.8bn (£126.8bn) in June to SFr 146.1bn for the three months to the end of September, the firm revealed today.
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Its investment management business saw a decline from SFr 84.4bn at the end of June down to SFr 66.8bn at the end of September, a drop of 21 per cent.
The fall was driven by a drop in unconstrained/absolute return bond (ARBF) assets under management, as well as outflows from other fund strategies.
Gam had closed redemptions in its ARBF funds in August after suspending portfolio manager Tim Haywood following concerns raised by a whistleblower.
Group chief executive Alexander Friedman said: "The consequences of the suspension of an ARBF investment director marked a clear setback for Gam.
“We are taking immediate and near-term measures to support Gam's profitability. We have a stable and diversified business that we continue to build upon and we remain fully focused on delivering the investment returns expected by our clients."
While it lost SFr 10.8bn in ARBF assets, Gam also experienced outflows of SFr 5.3bn from various other funds, including SFr 2.6bn from its fixed income products, while market movements cost it SFr 1.5bn.
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Gam’s share price has lost half its value since March as it experienced a rocky few months, revealing it would have to write-off its 2016 acquisition of UK hedge fund Cantab in July before suspending Haywood later that same month.
It has accused Haywood of breaching policy on gifts and entertainment and using personal email improperly, and raised questions about his record keeping and risk-management procedures.