Exodus: Abrdn said assets under management hit a record low of £494.9bn in the second half of last year

Exodus: Abrdn said assets under management hit a record low of £494.9bn in the second half of last year

Exodus: Abrdn said assets under management hit a record low of £494.9bn in the second half of last year

Abrdn has been hit by a £12.4billion investor exodus and is planning to axe 500 jobs.

The UK-listed funds giant said assets under management hit a record low of £494.9billion in the second half of last year. Its outflows were more than double the £5.2billion pulled out in the first half.

Chief executive Stephen Bird said: ‘Market conditions have continued to be challenging.’

Bird said institutional investors had been ‘de-risking’ by moving holdings into cash amid global uncertainties and high inflation.

He said that higher interest rates have hurt the funds industry, making investments less attractive to clients who could make a 5 per cent return by simply parking their money.

Abrdn’s intention to cut its costs by £150million, which will see 500 jobs go, was leaked earlier this week.

It wants to streamline the organisation and remove layers of management.

Bird said: ‘We are focusing on restoring our core investments business to a more acceptable level of profitability.’

Shares fell 3 per cent in morning trading but later recovered to end 1.6 per cent, or 2.7p, higher at 175p.

They have lost half their value since it was formed from the 2017 merger of Standard Life and Aberdeen Asset Management.

Analysts at JP Morgan said outflows remained a major concern in the long term, but investors would welcome cost cuts.

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