The cuts will reduce the asset manager's workforce by about 10 per cent.

UK asset manager abrdn announced yesterday that it plans to axe 500 jobs as part of its transformation programme, after the company reported that outflows from its funds had accelerated in the second half of last year, to the tune of -£12.4 billion (-$15.8 billion).

“The transformation programme targets an annualised cost reduction of at least £150 million compared to 2023, with approximately 80 per cent of the savings benefiting the investments business,” CEO Stephen Bird said in a statement. “This target excludes any cost reduction from previously announced divestments, including the sale of our European-headquartered private equity business. The programme includes the removal of management layers, increasing spans of control, further efficiency in outsourcing and technology areas, as well as reducing overheads in group functions and support services,” he continued. “The bulk of the savings will be in non-staff costs. The programme is expected to result in the reduction of approximately 500 roles.” 

"Market conditions have remained challenging for our mix of business, and this is reflected in our year-end assets under management and administration (AuMA), flow numbers, and margins,” Bird added.

AuMA was £494.9 billion as at 31 December 2023, which includes a £6.9 billion reduction due to corporate actions, including disposal of the firm’s discretionary fund management, which contributed £6.1 billion in AuM and its £4.1 billion US private equity businesses. It also acquired healthcare fund management business, Tekla for £2.3 billion, and four closed-end funds from Macquarie for £0.7 billion.

In the second half of 2023, net outflows of £12.4 billion represented 3 per cent of opening AuMA, the firm said. Net outflows (excluding liquidity) were £9.5 billion with outflows in Investments and Adviser. Institutional and retail wealth suffered net outflows in the second half of 2023 of £11.2 billion, the firm added. Net outflows (excluding liquidity) of £8.3 billion were driven by equities and fixed income, reflecting the challenging market environment and its exposure to Asia and emerging market solutions, the firm continued.

Investments AuM as of 31 December 2023 was £366.7 billion, down slightly from June 2023, with positive market movements offset by net outflows and the disposal of the US private equity business, the firm said.