Perpetual's funds under advice continue to slide

In an ASX listing on Wednesday, Perpetual reported that the funds under advice (FUA) of Perpetual Private fell by 1 per cent during the first quarter to $17.2 billion.

The main driver for the decrease in FUA was negative market movements, which were partially offset by positive new inflows of $0.1 billion.

Overall, Perpetual’s total assets under management (AUM) were $89.8 billion at 30 September, 1 per cent lower than the prior period, with negative market impacts and flows offset by positive currency movements.

“This quarter was a tough period for asset managers, with investment markets declining globally,” said chief executive officer and managing director, Rob Adams.

“Pleasingly, our relative investment performance has remained strong across the majority of our equities strategies, with our Australian equities strategies and Barrow Hanley’s equities strategies stand-outs in delivering strong outperformance for our clients,” Mr Adams noted.

Reiterating the comments he made last quarter, Mr Adams said he believes the higher inflation and interest rate backdrop will continue into next year and while market movements impact the value of the assets the firm manages, “this kind of environment continues to be well suited to our expertise in value-style investing”.

The AUM of Perpetual Asset Management Australia (PAMA) stood at $21.3 billion, flat on the prior quarter, with net outflows impacted by the loss of one mandate in the intermediary channel.

Moreover, Perpetual Asset Management International’s (PAMI) AUM was $68.5 billion, a decrease of 1 per cent, impacted by negative market movements and net outflows, which were offset by positive net inflows in global equities strategies and favourable currency movements.

“In Perpetual Asset Management International, the overall net flows result was disappointing, mainly reflecting the broader market sentiment towards equities, particularly in the US,” Mr Adams said.

But Perpetual Corporate Trust (PCT) continued to deliver steady growth with funds under administrations adding 3 per cent to $1.12 trillion.

Separately, and in addition to its business update, Perpetual provided an update on its proposed acquisition of Pendal.

“Progress has been made across the key conditions to the transaction, including seeking client consents and regulatory approvals,” Mr Adams said.

“Client consents are tracking in-line with both parties’ expectations and the regulatory approval process has also commenced. Assuming all the key conditions to the transaction are met, we are on course for targeted completion of the transaction by January 2023.”

Also on Wednesday, Pendal announced that it is progressing work on the scheme booklet, with an intention to dispatch it in November and hold a scheme meeting in December 2022.