Weekly Fund Distribution Notes – 07 October 2025
16th October 2025
As always, the most important mandate and fund selector news. While average operative margins in the asset management sector appear to be improving again, it is the speed between winners and losers which becomes more and more interesting. Last but not least, the base ingredients for real growth strategies.
What’s the news from the buy-side? Firstly, double news from M&G: The firm has won a EUR 173 million bond mandate from Italian co-operative banking group BCC Icrea. BCC Risparmio & Previdenza, the investments and savings arm of BCC Icrea, acts as the prime distributor of the fund. M&G also launched an impact-focused private debt strategy, funded by the Dutch pension fund Pensioenfonds KPN with a commitment of EUR 300 million. In Germany, BlackRock’s Global Infrastructure Partners and Allianz GI have been selected by German pension fund Versorgungsanstalt des Bundes und der Länder to run a EUR 1.5 billion infrastructure debt mandate. In the UK, Aviva announced it was launching a default pension investment strategy with a sizeable allocation to illiquid asset classes, relying on both in-house expertise and external partners such as Apollo, Invesco, Neuberger Berman, KKR and StepStone Group.
Citywire Selector featured a wrap of the most important fund selector moves in September (see link section below), with insights on what’s on the search menu for Spanish fund selectors (a rather broad spectrum ranging from European investment grade, hybrid, Nordic and flexible bonds, European equities with a value bias, alternatives and EM debt). The publication also featured an article on Edmond de Rothschild private banking investment boss Nicolas Bickel arguing that clients could be stomaching a bit more illiquidity, and increasing their allocation to private markets. Speaking of private markets, voices of concern are getting louder and broader.
Change of scene. Ignites Europe addressed asset managers’ costs and profitability in six charts based on analysis of 12 listed fund houses over the past 5 years, suggesting a modest uptick in asset manager margins in 2024. Last year’s average operating margins stood at 23%, following 18% in 2023 and 21% in 2022. BlackRock’s operating margin stood at the highest among the 12 managers analysed at 37%, up from 35% in 2023. Markets helped, as did higher margin products, but the broader “turn-around” is more attributed to operational optimisation and cost reductions.
Ignites quoted Michael Werner, co-head of the European diversified financial research team at UBS, as saying that “asset managers had taken steps such as cost-cutting to cope with persistently slim margins. It’d be a lot worse if [managers] were not focused on optimising the cost base in recent years, and they have to continue to do that to ensure growth.” However, Michael Klimek from Dolphinvest added that “asset managers were still light years away from other industries that had learned the hard lesson of surviving on super slim margins.” Well, will asset management head towards super slim margins? We don’t think so. Asset management enjoyed very high margins for a long time and, let’s be realistic, asset management margins still sit comfortable within service industry peers. Anyway, the margin spread between “winners and losers” is likely to increase.
In the case of Franklin Templeton, it must be mentioned that the number in our chart of the week below is contorted by Franklin’s EUR 332 million impairment charge on intangible assets tied to mutual fund contracts at Western AM. On an adjusted basis, the operating margin would stand at 26%.
Last but not least, we love hosting clients at our offices in Valencia. Being away from all the noise of financial centres yet having world-class data, market and investor insights at hand enables unique perspectives and thorough thinking – the base ingredients for real growth strategies. Clients love these session here. See: Link. Also, who else has orange trees in front of their offices? Pay us a visit, but be warned: Valencia and Acolin Intelligence have something addictive!
