Swiss fund house GAM Investments has warned of a non-cash impairment charge in its results expected 3 August, as the group's AUM drops CHF16bn - blamed on the "volatile market environment".
The manager's AUM declined CHF16.6bn, from CHF99.8bn at 31 December 2021 to CHF83.2bn, 80% of which it linked to negative market movements of CHF12.4bn and foreign exchange of CHF0.7bn, reports International Investment sister title Investment Week.
The firm said it expected to report an underlying loss before tax of approximately CHF15m, compared to a CHF0.8m profit a year prior.
Outflows from its fund management services climbed to CHF2.5bn, while its investment management arm suffered outflows of CHF1.1bn.
As a result of the reduction in AUM, the firm said it expected to report a non-cash impairment charge of CHF264m, related to the intangible brand value created by its acquisition by Julius Baer in 2005.
Losses totalling £2.4bn drive Polar Capital AUM down 14% in Q2
It said the charge would lead to IFRS net losses of approximately CHF275m, a CHF272.3m jump from its loss figure this time last year (CHF2.7m).
"During the first half of 2022 we have seen extraordinary economic and geopolitical conditions having a significant impact on markets. As a result of this volatility, clients have been exercising greater caution," said Peter Sanderson, GAM Investments CEO.
"Despite this, we are encouraged to see improving resilience in our flows with clients allocating to a number of our high conviction active strategies designed to help them navigate this challenging environment," he added.
According to the firm, both the charge and the IFRS will not impact the group's tangible equity, cash position or client-related or operational functions.
It comes as a slew of firms reveal struggles throughout the year, with BlackRock and State Street's AUM both falling 11%.
