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UK funds under management reach record GBP6.2 trillion

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The UK’s fund management sector was responsible for a record GBP6.2 trillion of funds at the end of 2013, according to TheCityUK’s Fund Management 2014 report.

The sector recovered quickly from the fall experienced at the outset of the economic downturn and is now nearly 50 per cent above the pre-crisis peak.
 
According to the report, over a third of these funds, around GBP2.2 trillion, came from overseas clients, making the UK a global leader in managing foreign clients’ funds.
 
The 2013 figures show the sector overall has experienced its fifth consecutive year of growth, increasing 14 per cent.  TheCityUK also estimates that assets increased by around five per cent in the first six months of 2014, with the full year increase forecast to top nine per cent.
 
Chris Cummings, chief executive, TheCityUK, says: “The UK is one of the leading international centres for fund management and by far the largest European centre. The fund management sector is also one that consistently generates a significant trade surplus for the UK economy. 
 
“The strength of these latest figures also demonstrates the attractiveness of the UK as place in which, and from which, to do business.  While London is central to the UK’s strong international position, other cities such as Edinburgh, Glasgow, Aberdeen, Manchester, Liverpool, Cardiff and Birmingham are also important centres for fund management.  In fact one third of the 50,000 people directly employed in the sector are based outside of London.” 
 
The report also shows that nearly two thirds, some GBP4.0 trillion, of funds under management came from institutional clients, with retail clients generating a further 16 per cent (GBP999 billion). The remainder is accounted for by private client funds and alternative funds.  
 
In an international context, UK funds under management accounted for 8.4 per cent of global fund management assets, totalling USD146 trillion at the end of 2013. The US remains by far the biggest source of funds, accounting for nearly half of assets.
 
While the UK is largely known as a centre for management of international funds, it is increasingly becoming a location of choice for domicile of funds. Of the top five European locations for domicile, the UK saw the biggest increase in assets in 2013 (10.9 per cent), ahead of Luxembourg (9.7 per cent), Ireland (9.5 per cent), Germany (9.2 per cent) and France (1.3 per cent).
 
Cummings says: “As the leading global centre for cross-border financial services, London and the wider UK are well positioned to capture a growing share of business from international markets which offer the greatest potential for growth.
 
“TheCityUK welcomes actions taken by the government to make the UK as competitive as possible for fund domicile and management. We look forward to continuing our work with the government under the Financial Services Trade and Investment Board (FSTIB), our members and the wider industry to extend the promotion of the fund management sector overseas and to help drive jobs and growth across the country.”

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