BlueBay Declines After Saying Assets Fell 7% in Quarter on Currency Losses

BlueBay Asset Management Plc, the London-based manager of fixed-income funds, said assets under management dropped 7 percent in the fiscal fourth quarter on a fall in financial markets and foreign-exchange losses.

Funds shrank to $34.3 billion at June 30 from $37 billion at the end of March, while inflows were $300 million in the quarter, BlueBay said in a statement today. The stock fell 1.2 percent to 291.6 pence at the close in London.

“Inflows were very disappointing,” said Nitin Arora, a London-based analyst at Execution Nobel Ltd. who has a “hold” rating on the stock. “BlueBay has highlighted that going forward, inflows are likely to remain muted as the investment- grade funds have hit the capacity.”

BlueBay has dropped 3.2 percent this year, outpacing the 2.7 percent decline in the 73-member FTSE 350 Financial Services Index. Assets fell by $2.7 billion after the company moved euro- denominated assets into U.S. dollars, BlueBay said. Performance fees for the six months to the end of June were 8.4 million pounds ($13 million).

“Raised levels of market volatility and reduced investor risk appetite made the final quarter of the financial year a more challenging one than its predecessors,” Chief Executive Officer Hugh Willis said in the statement.

BlueBay said it expects full-year pretax profit to be about 50 million pounds, compared with 17.5 million pounds a year earlier. The company will announce results for the year ended June 30 on Sept. 16.

To contact the reporter on this story: Andrew MacAskill in London at amacaskill@bloomberg.net

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