Perpetual sees $5.1bn outflows post Pendal deal
Since closing the Pendal deal in January 2023, resulting in a $200 billion fund manager, Perpetual’s results for the fourth quarter reveal it saw $5.1 billion in net outflows.
Assets under management (AUM) were up by a modest $1.7 billion in the three months to 30 June to stand at $212.1 billion, driven by strong investment performance in Perpetual Asset Management in Australia and Barrow Hanley and TSW in the US.
However, it also reported $5.1 billion in net outflows, mainly in global equities strategies and fixed income.
Looking specifically at Pendal, it saw net outflows of $1.2 billion during the quarter as it integrated with Perpetual following the acquisition which Perpetual said was the result of a large mandate loss in fixed income. Outflows were partially offset by strong investment performance and positive market movements of $0.4 billion.
During the quarter, Pendal also retained $6.8 billion in AUM as part of the Westpac sale of its Advance business to Mercer Super Trust.
Pendal strategies were the main contributors to the overall $3.2 million earned in performance fees and it said total performance fees for FY23 totaled $15.2 million.
Rob Adams, managing director and chief executive, said the firm has continued to focus on integrating Pendal Group into the business.
“While we are only six months in, we have already made solid progress in delivering the synergy benefits of the acquisition which are tracking to plan,” Adams said in an ASX statement.
Total funds under advice (FUA) was $18.5 billion, 1 per cent higher than the previous quarter. Net inflows were $100 million, with continued contributions from the philanthropy sector and native title clients. The latter reached a record of $1 billion in FUA through the quarter.
Adams said: “Our wealth management business continues to be a solid performer as a leading private wealth advisor in the Australian market, delivering another quarter of positive net flows.”
The firm also touched upon its IT security incident in June, which saw some of Perpetual’s services impacted by an extended outage of its third-party provider.
The third-party provides unit registry and administration services to Perpetual’s asset management and wealth management division investment funds, WealthFocus and Select products.
“Most services have now been restored; however, work is ongoing to restore the client portal, myPerpetual, which is expected in the next few weeks,” the firm announced.
“Throughout the outage, transactions continued to be queued and processed with unit pricing reflective of the day that applications were received and accepted.
“There was no impact to any Perpetual client investments or its own systems. Perpetual’s listed products, institutional mandates, Pendal Group business, Perpetual Corporate Trust, Perpetual Private Wrap, and products distributed offshore were unaffected.”
AUTHOR
Rhea Nath
Recommended for you
Tribeca Investment Partners has made a distribution hire from Australian Ethical in a newly-created role focused on the national intermediary market.
Asset managers may be urged to diversify their product ranges, but investment executives have warned any M&A deal should avoid simply filling gaps and instead consider long-term value creation.
Specialist wealth platform provider Mason Stevens has become the latest target of an acquisition as it enters a binding agreement with a leading Sydney-based private equity firm.
Fund managers are entering 2025 with the most bullish sentiment since August 2021 and record high allocations to US equities, thanks to the incoming Trump administration.
