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Fund manager abrdn's assets hit by market volatility, shares dive

FILE PHOTO: Businessman toy figure is placed on U.K. Pound coins in front of displayed Abrdn logo in this illustration taken

(Reuters) -Fund manager abrdn's shares fell nearly 9% on Tuesday after it reported a drop in assets under management in the first half of the year as Britain's economic chills weighed on markets and investor sentiment.

British investors were seen playing safe, pulling out from equity funds in favour of money market and fixed-income funds in June, fund network Calastone said last month, as they deal with higher inflation and interest rates.

abrdn reported assets under management and administration (AUMA) of 495.7 billion pounds ($632.27 billion) as of June 30, compared with 500 billion pounds at the end of December. Analysts on average expected AUMA of 500 billion pounds for the period, according to company-compiled estimates.

Net outflows were 4.4 billion pounds for the first six months of 2023.

Meanwhile, abrdn raised its share buyback plan to 300 million pounds from 150 million pounds announced in June.

Adjusted operating profit for the first half rose 10% to 127 million pounds as the company kept a lid on costs but missed analysts' estimate of a profit of 133 million pounds.

Shares of abrdn were down to 198.90 pence by 0750 GMT, after rising more than 15% so far this year.

Separately, UK fund manager Quilter reported on Tuesday a 2% rise in assets under management and administration to 101.7 billion pounds in the first half. But that was below analysts' forecast of 102.9 billion pounds, according to company-provided consensus.

"The challenge is the market is under a lot of pressure, clients are feeling the pinch," Quilter CEO Steven Levin told Reuters.

"Discretionary investments are under pressure, everyone is seeing that and reporting that."

However, Quilter's adjusted profit before tax of 76 million pounds easily beat analysts' expectations of 56 million pounds, sending the company's shares 10.5% higher in morning trade.

($1 = 0.7840 pounds)

(Reporting by Eva Mathews in Bengaluru and Carolyn Cohn in London; Editing by Sherry Jacob-Phillips and Susan Fenton)