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Money Management

AllianceBernstein AUM dips 1.8% in quarter, but rises 4.5% for year

AllianceBernstein (AB) reported assets under management of $539.8 billion as of June 30, down 1.8% from the end of the previous quarter but up 4.5% from a year earlier in its earnings statement released Thursday.

Net outflows across the firm's investment businesses were $7.7 billion in the quarter ended June 30 vs. net outflows of $2.4 billion in the three months ended March 30 and net inflows of $4.7 billion for the second quarter of 2017.

Net outflows from institutional investors were $8 billion in the quarter ended June 30 compared to net outflows of $2.8 billion in the first quarter and net outflows of $1.2 billion a year earlier.

In the earnings report, AllianceBerstein said institutional investor net outflows in the second quarter 2018 included a large — $7 billion — redemption from a customized retirement strategy mandate from an unnamed client in April.

Looking forward, the company noted in its earnings report that its pipeline of awarded but unfunded institutional mandates rose to $7.1 billion as of June 30 compared to $5.7 billion at the end of the previous quarter.

By asset class, in the second quarter of 2018, actively managed equities had the largest net inflows, $3.4 billion, followed by passively managed equity and tax-exempt fixed income which each brought in $300 million of net inflows during the three-month period. Net inflows of $200 million were directed into passive fixed-income strategies in the quarter.

"Despite ongoing volatility in the global markets during the quarter, we maintained strong client momentum in the key areas of our business," said Seth P. Bernstein, president and CEO, in the second quarter earnings report.

Net outflows for taxable fixed-income strategies totaled $5.9 billion in the quarter ended June 30. Other AB investment strategies, including multiasset class solutions and alternative investments, experienced net outflows of $6 billion in the second quarter 2018.

AllianceBernstein's net revenue for the second quarter 2018 quarter was $844.7 million, down 2.7% compared to the prior quarter and up 5.3% from a year earlier.

Net income was $181.9 million in the three-month period ended June 30, down 12% from the previous quarter but increased strongly — 19.5% — from the second quarter 2017.