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UBS Asset Management was Europe’s worst-selling fund house in April, in a sign that the firm faces an uneven recovery as it seeks to turn around its fortunes following the acquisition of Credit Suisse.
Switzerland’s largest asset manager suffered net outflows of €3.6bn in April, having had redemptions of €430mn in March, according to Morningstar data that excludes money market and funds of funds.
“Large mergers end up with a longer than anticipated integration period due to organisational complexity,” said Amin Rajan, chief executive of asset management consultancy Create-Research.
“In asset management, organisational stability is vital during the transition phase, otherwise clients tend to walk away with their money,” he added.
This article was previously published by Ignites Europe, a title owned by the FT Group.
According to a person close to UBS, the firm expects to see fluctuations in flows as it integrates Credit Suisse’s products.
The firm’s fund flows in April were “within the normal range” for products of their size, the person added.
Valerio Baselli, investment specialist at Morningstar, said some of the flows reflected top-down asset allocation shifts in UBS’s wealth management channels, “which regularly see large shifts between asset classes and have repeatedly made a noticeable imprint on European fund flows”.
UBS AM and the former Credit Suisse Asset Management business together garnered net inflows to their European funds of €7.9bn between December 2023 and February 2024, suggesting a recovery was under way for the combined business.
Since the completion of the Credit Suisse acquisition in June last year, UBS has been working on its transition plan to bring together the two managers’ fund ranges, including liquidating funds that will not be included in the firm’s product range.
But inflows to the combined European fund range began to slow last month and have worsened in April, Morningstar data shows.
As separate entities, UBS suffered outflows of €1.6bn in April, while Credit Suisse had outflows of €2bn.
Cumulative net flows for the Swiss fund house remain positive over the year to date, however, with UBS garnering inflows of €8.4bn and Credit Suisse having net outflows of €5.8bn over the first four months of the year.
In April, most of UBS’s outflows related to passive products, totalling €2.6bn, despite the wider shift
