The asset manager behind one of the biggest insurance companies in the UK has outlined plans to reduce its funds as it attempts to slash costs – potentially to as little as 200 within 18 months.
Speaking at the FundForum conference in Berlin, Aviva Investors chief executive officer Euan Munro outlined that there’s “no reason why we should have more than 200 or 300 funds”. The company has already cut its funds to around 1,500 – this is down from around 3,000 when Munro took office back in January, 2014.
According to a Bloomberg report, the asset manager’s parent company Aviva Plc has been looking to reduce its costs significantly in a bid to boost profitability. Asset managers have been placed under pressure recently due to an increased level of competition from low-cost index funds, as well as automated advisory services.
Munro has reassured staff however, that the fund cuts will not lead to a “major headcount reduction” with the company still continuing to grow.
Speaking at the conference he stated that the industry often thinks that creating a new fund or new product should be the focus rather than putting more into products to make them do what they are supposed to do.
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