Monday, 28 July 2014
Last updated 1 hour ago
Oct 26 2012 | 3:08pm ET
Asset management giant Legg Mason reported net inflows of $200 million in its fiscal second quarter, ended September 30, compared to outflows of $17.6 billion a year earlier.
It's the first time the Baltimore money manager has reported a quarter of net inflows since mid-2007.
On the other hand, the positive result was entirely due to investors moving money into more liquid assets (like money market funds, which gained $9.7 billion in Q3) and out of equities and fixed-income, which lost $5.7 billion and $3.8 billion, respectively, reports the Wall Street Journal. Moreover, Legg Mason warned it expects significant withdrawals this month as investors continue to bail on equities funds.
Assets under management rose to $650.7 billion as of the end of September, up from $631.8 billion at the end of the prior quarter.
Legg Mason reported a profit of $80.8 million, up 43% from the prior year. That gain was thank to seed investments and other non-operating contributions—revenue fell 4.4% to $640.3 million.
The firm, which has been battling poor performance and customer redemptions for several years, has also been in the sights of activist hedge fund Trian Fund Management, its second-largest shareholder, which forced the resignation of former Legg Mason chief executive Mark Fetting in October. Legg Mason says finding a replacement for Fetting could take “several months.”
An agreement barring Trian from raising its 9.5% stake in Legg Mason expires next month.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…