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Laxman Pai, Opalesque Asia: Listed North American asset management firms experienced steep declines in assets under management (AUM) and revenue during the second quarter of 2022 after seeing all-time highs in assets, revenues, and profit levels just two quarters earlier.
According to a report by Casey Quirk, a Deloitte business, 18 public traditional and alternative asset managers in North America saw their combined AUM drop by 12% in the second quarter, while revenues fell by 8%.
The 18 managers had a combined AUM of $17 trillion as of June 30, it said. Though AUM declines predominantly came from the market downturn, asset flows in the quarter for most firms were either flat or slightly negative.
"Firms are responding to these industry and macroeconomic headwinds by reducing expenses, including compensation, which is down 6% versus Q2 of 2021. Although non-compensation expenses were up 3% relative to the year prior, they were nonetheless down 3% versus the previous quarter," it said.
Meanwhile, public alternatives managers were a bright spot in an otherwise tepid quarter. They saw slight AUM growth in Q2 along with strong fundraising momentum as demand for illiquid allocations continued to be strong. Median revenue growth was also positive at 7% versus the previous quarter, although 29% of firms did experience a decline.
Expenses at alternatives managers also continued to trend upward, with overall operating expenses up 3% and compensation up ju...................... To view our full article Click here
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