IOOF, Australian Wealth’s Managed Funds Decline
IOOF Holdings Ltd. and Australian Wealth Management Ltd., the asset managers that agreed to merge last year, said funds under management plunged as financial markets tumbled amid the global credit crisis.
IOOF’s funds under management and administration fell 19 percent to A$23.7 billion ($16 billion) at Dec. 31 from June 30, due to a slump in equities and property trusts. First-half profit, excluding revaluations related to units, was A$7.9 million in the six months to Dec. 31, down 50 percent from a year earlier, Melbourne-based IOOF said in a statement to the stock exchange.
Australian Wealth’s funds under management dropped 7 percent to A$56 billion, the Sydney-based company said in a statement. It took a charge of A$154 million to write down goodwill. Net profit before the charge and non-recurring items fell 30 percent to A$23.4 million in the six months ended Dec. 31, it said.
IOOF and Australian Wealth Management agreed to merge in November after a yearlong equities rout battered earnings at fund managers and triggered the collapse of asset managers including Babcock & Brown Ltd no faxing payday loan. and Allco Finance Group Ltd. Australia’s benchmark S&P/ASX 200 Index declined 29 percent in the last six months of 2008 as the credit crunch deepened.
“With market conditions likely to remain volatile for the rest of this year, delivering growth in the short term will continue to be challenging,” said IOOF Chief Executive Officer Antony Robinson in the statement. “We remain confident in the medium to long-term outlook for the wealth management industry.”
IOOF shares lost 6 percent to A$3.12 in Sydney. They tumbled 55 percent last year. Australian Wealth fell 11 percent to 81.5 cents after plunging 56 percent in 2008.
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