Already a subscriber?First Sentier will shut down its Australian fixed income and global credit units and hand back $8 billion to investors, marking the end of what was once the biggest local bond fund.
that closing the funds was “financially immaterial” to the business, which wanted to focus on profitable strategies. Equity income as an asset class, he said, “has not taken off the way people anticipated” as investors turned to capital growth to finance their retirement. “Fixed income is a fairly complicated market to keep on top of. Of the 30 people who we’re parting company with, 20 were in our fixed income and credit teams. That’s a large cost base,” Mr Allen said. “It’s hard to actually get the numbers to stack up. It’s a scale business, you need tens of billions of dollars to be able to fund active fixed income.”First Sentier was acquired by Japan’s Mitsubishi UFJ Trust from Commonwealth Bank in 2019. At the time, the manager had $218.4 billion of assets.