Gartmore sees client funds plunge

FUND manager Gartmore has seen its assets under management plunge after the suspension of its star fund manager.

The firm, which listed in December and has since seen its share price almost halve, said assets fell nine per cent to £20.3bn at end-July, after £1.9bn of outflows in the first seven months of the year.

Guillaume Rambourg was suspended as part of an internal probe that raised investor questions over the company's internal procedures. Since then gratmore has struggled to retain clients.

In addition, Gartmore said it had seen £67m of redemptions on 2 August for its hedge funds and notices for another £223m of redemptions as of 16 August.

Chief executive Jeffrey Meyer said: "The financial results for the first six months of 2010 showed a satisfactory improvement with EBITDA increasing by 146 per cent.

"However, our net sales were below expectations primarily due to the suspension and subsequent
resignation of one of our portfolio managers.

"We are now focused on regaining momentum and believe we are attractively positioned to benefit from the continuing demand for absolute return products and the general growth potential of our UK Retail business."