Second asset manager to close Australian equity strategy

T. Rowe Price T. Rowe Price Australian Equity Strategy funds management australian equities

24 April 2024
| By Laura Dew |
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T. Rowe Price has announced it will close its Australian equity strategy as it believes it is unlikely to gain sustainable scale.

The global asset manager, which has $2.1 trillion in assets under management, said the closure is also tied to the departure of the fund’s portfolio manager Randal Jenneke this July.

Jenneke has been at T. Rowe Price for the past 11 years and is the head of Australian equities.

In a statement, the firm said: “After a thorough evaluation, T. Rowe Price has decided to close the strategy, as it was unlikely to gain the scale to be sustainable.”

All traders and analysts based in Sydney will remain with the firm and contribute to Australian equities research on the firm’s global funds. It said the firm currently manages $7 billion of investment in Australian companies. 

T. Rowe Price Australia’s country head, Darren Hall, said: “While we are closing the chapter on our local Australian equity strategy, we continue to remain invested in areas where our investment capabilities intersect client needs, including global equities, fixed income, multi-asset and private credit. We are also committed to sharing our knowledge and experience in retirement and ESG.”

The closure means T. Rowe Price now has no dedicated Australian equity or bond vehicles. 

However, the firm stressed there are a number of Australian unit trusts on its other global funds that are available to Australian investors.

The closure follows the decision by First Sentier Investors (FSI) on 23 April to close four of its Australian investment teams, affecting 10 funds and $14 billion in assets under management. 

The PCT funds will be closed but CFSIL are looking for alternate managers for the funds where they are the responsible entity and it is understood this will happen in the next month.

The funds are:

  • CFS Wholesale Indexed Australian Bond (CFSIL)
  • First Sentier Australian Bond (CFSIL)
  • First Sentier Diversified Fixed Interest 
  • First Sentier Global Credit Income (CFSIL)
  • First Sentier Global Credit Income (PCT)
  • First Sentier Equity Income (CFSIL)
  • First Sentier Equity Income (PCT)
  • First Sentier Target Return Income (CFSIL)
  • First Sentier Developing Companies (CFSIL)
  • First Sentier Future Leaders (CFSIL)

FSI said it expects to manage these in line with existing investment objectives for a number of months as it works with mandate clients regarding the transition. Some 30 investment professionals are affected and “a small number” of these will be redeployed within other roles in the business.

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