Evidentia FUM approaches $30bn in Q4

Generation Development Group (GDG) has reported continued growth in funds under management (FUM) for Evidentia Group following its acquisition earlier this year.

In February, GDG announced it would acquire 100 per cent of Evidentia Group to form a managed account provider which, when combined with Lonsec Investment Solutions (LIS), would have $25 billion in FUM.

In the Q4 update, GDG said it has now successfully integrated the two managed accounts operations and achieved 100 per cent client retention since the transaction.

As at 30 June, Evidentia Group had some $29.6 billion in FUM, marking a 49 per cent increase compared to the prior corresponding period as a result of the integration, exceeding the firm’s initial expectations.

Notably, Evidentia and LIS are evenly split in terms of the overall FUM with $14.8 billion each. When compared to the prior corresponding period, Evidentia’s FUM has increased 60 per cent, while LIS was up by 39 per cent.

Since the transaction, Evidentia Group has acquired seven new clients with all existing mandates successfully retained throughout the period, with GDG chief executive Grant Hackett saying the new client inflows will commence in FY26.

Hackett said there is still a strong growth pipeline of potential new mandates and accounts which will position Evidentia as a market leader in the managed account space.

“We are exceptionally pleased with the speed and precision of our business restructure, which has provided clarity of purpose for each team and created an environment designed for success.

“We have a very strong growth pipeline of potential new mandates and accounts that we will continue to target and convert in FY26. Our platform expansion, enhanced product solutions, and strategic partnerships are positioning Evidentia as a market leader in delivering tailored, scalable investment solutions.”

On the Lonsec Research and Ratings business, which sits outside of Evidentia Group, chief executive Lorraine Robinson said the firm had seen a 6 per cent rise in products researched during the year from 1,732 to 1,836. 

The firm said this growth was primarily due to “out of cycle” or on-demand ratings, the latter of which accounted for 64 per cent of new ratings marking a significant uptick from the 46 per cent seen in FY24. 

This is largely a result of the surge in private markets investment products which are either new ones or existing overseas funds seeking to enter the Australian market. 

“Alternatives as an asset class, which includes private markets, constituted 5 per cent of the products rated but accounted for 19 per cent of the new products for the year,” Robinson said. 

Earlier this year, Lonsec detailed how it had enhanced its private markets model to better capture additional risks such as illiquidity and governance. There are numerous “areas of heightened risk” for private credit funds compared to other funds, it said, which include governance, start-ups, vertical integration, expertise, resourcing, portfolio diversity, and underwriting standards. 

Darrell Clark, deputy head of research and sector manager – alternatives at Lonsec Research and Ratings, said: “Lonsec seeks to remain adaptable to evolving market dynamics and ASIC’s ongoing reviews of private markets, ensuring our approach aligns with best practices and regulatory expectations.”