BGI today reported a pre-tax profit decline of 32% for the year ended June 30, in part because of £196 million in reserves set aside to bolster its liquidity vehicles if needed.
The money manager reported £265 million ($514.9 million) in pre-tax profit on June 30, down from £388 million the year before and down from £346 million on Dec. 31.
Assets under management as of June 30 were $1.97 trillion, down 5.3% from six months earlier and 2% less than a year earlier. BGI reported $147 billion in losses from negative market movement for the six months, more than offsetting the $25 billion in net new assets and $10 billion in positive exchange rate movements.
“Profit was impacted by selective support of liquidity products of £196 million,” according to an earnings release. The money provided “credit protection to certain institutional liquidity products” in the event that such protection was needed, said Robin Tozer, spokesman at parent Barclays PLC in London.
Separately, insurer Allianz Group reported assets under management for its asset management business of €740 billion ($1.13 trillion) as of June 30, down 3.2% from the start of the year and down 6.2% from a year earlier.
Net inflows for the first half of the year were €33 billion up from €20 billion for the first half of 2007, according to an earnings release. Growth was driven primarily by its fixed-income business, managed by bond giant PIMCO.
Operating profit for the asset management business, which includes PIMCO, RCM, Nicholas-Applegate, Oppenheimer Capital and NFJ Investment Group, totaled €281 million, a 13.5% decline from the previous year but only 3.1% less when adjusted for exchange rate effects, according to the release.
Overall, Allianz reported total revenue of €22 billion, down 9.5% from a year earlier. Operating profit decreased by 36% to €2.1 billion.
“The tough market environment has exerted pressure on our second-quarter results,” said Michael Diekmann, CEO of parent Allianz SE, in the release. “However, the fundamentals of our business remain strong and we were able to deliver a solid performance. In addition, given our solvency ratio, we feel very comfortable with our capital position.”
