Pendal sees performance fees rise to record level

Performance fees at Pendal Australia have risen 29% in the past quarter after outperformance by its Australian equity portfolios. 

In an announcement, the firm said performance fees were $16.4 million in the three months to 30 June, which was a 29% rise from $12.7 million in the 2020 financial year.  

Chief executive Nick Good said the rise reflected the “continued strong outperformance achieved in the Australian equity portfolios in recent years”.  

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According to FE Analytics, over three years to 30 June, 2021, within the Australian equity sector, MicroCap OpportunitiesMidCapFocus Australian Share and Australian Share had all beaten the sector average, within the Australian Core Strategies universe.  

Meanwhile,  ImputationSmaller Companies and Focus Australian Equities had all seen returns exceeding 25%.  

Pendal MicroCap Opportunities was the best-performing fund with returns of 45.7%. 

Performance of Pendal funds versus Australian equities sector over three years to 30 June 2021 

Over the last three months to 30 June, 2021, the MicroCap Opportunities was again the best-performing fund with returns of 12.4% followed by the MidCap fund which returned 8.7%. 

Performance of Pendal funds versus Australian equities sector over three months to 30 June 2021 

Pendal Australia funds under management (FUM) rose from $34.4 billion at the end of March to $37 billion, although the institutional channel saw outflows of $0.4 billion which Pendal said was mostly in cash and fixed income. 

Group FUM rose from $101.7 billion to $106.7 billion due to investment performance, higher markets and a positive currency effect.  

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Let me get this right; their funds (which we don't use just for the record) appears to have had spectacular outperformance but instead the article is cast in a negative light around increasing fees (which is obviously just a pre-established common by-product of good performance).

I suppose the conclusion of this article is it's preferable they had lower fees generated from mediocre performance at the same or lower than any benchmarked index or other metric?


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