T. Rowe Price AUM rises 3.6% in quarter, plunges 24.5% for year

T. Rowe Price Group reported assets under management of $1.27 trillion as of Dec. 31, up 3.6% from three months earlier, but down 24.5% from a year earlier.

Net outflows totaled $17.1 billion in the fourth quarter, compared with net outflows of $24.6 billion in the third quarter and net outflows of $22.7 billion in the fourth quarter of 2021, according to a news release Thursday.

By asset class, in the fourth quarter of 2022, equity, fixed income (including money markets), multiasset strategies and alternatives had net outflows of $14.3 billion, $2 billion, $500 million and $300 million, respectively.

Net market appreciation and other gains added $61.8 billion in the fourth quarter.

Net outflows in the fourth quarter were "largely concentrated in equity strategies sourced from the firm's U.S. intermediary channel," T. Rowe Price said in the release, while the firm's Asia-Pacific institutional and intermediary channels "delivered positive net cash inflows during the quarter."

To address the decline in year-over-year AUM decline, and to protect the firm's "capacity to invest in strategic initiatives, we focused on controlling expenses by cutting third-party spend, initially slowing the pace of hiring, and ultimately reducing our headcount by about 2%," said Rob Sharps, president and CEO, in the news release.

In discussing the economic backdrop to the firm's results, Mr. Sharps said: "All developed equity markets and most emerging ones recorded gains in the (fourth) quarter, although stocks still closed out their worst year since 2008. Investors appeared encouraged by signs of peaking inflation, the improving energy supply situation in Europe, and China's relaxation of strict coronavirus restrictions."

However, he added: "Despite the improvement in most equity and fixed-income indices in the (fourth) quarter, recession worries and warnings of further rate hikes from central bankers continued into year-end, particularly in the U.S."

Looking at 2023, Mr. Sharps said: "While headwinds are likely to persist in 2023, we expect more constructive markets, improved performance in key strategies, and traction in our growth initiatives will return the firm to positive organic growth over time."