Fund managers keep investments in place

BARINGS

BY NIC CICUTTI

Investors in Barings' 20 unit trusts have held their nerve following the re-opening of trading in their funds, according to fund managers.

The fund managers' claims, aimed at steadying investors' confidence, come in the wake of Barings' takeover by ING, the Dutch banking giant.

Assurances were given early on by Barings that up to 50,000 holders in its trusts, in which more than £1bn is invested, were ringfenced against the bank's collapse.

Experts pointed out that loss of confidence by unit-holders could precipitate mass sell-offs, depressing the value of units.

However, Nick Wells, product development manager at Barings Fund Managers, said: "Our unit trusts opened for trading after a three-day suspension that started on 27 February. Since then, we have experienced light selling pressure, like a normal day, as a result of recent events. It has not been a one-way street. We have also been selling our units into the market place.

"We have been talking daily to many thousands of clients and our top 300 intermediaries with whom we do business, keeping them up to date with what has been happening. They have remained incredibly supportive.

"It is too early to tell but the important thing in the asset management operation is that the people managing the fund are exactly the same. They have remained where they are, focusing on the funds."

The position for investment trusts, which deposited more than £10m in Barings' banking arm, has also cleared. The money has been unfrozen, while the investment trusts were always safe against calls on them.

They remain subject to nervous market sentiment. Despite this, Barings announced that its Dublin-based offshore operation has re-opened for trading.

Andrew Oliver is a director at Sedgwick Financial Services, which has about 2,000 clients investing in Barings' UK-authorised and offshore funds. He said: "Our advice is that it is very early days. Barings seems to be a good fit with its new parent company. The asset management team with whom we have always dealt is intact. Our advice is stay put for now."

The agreed ING takeover led to the bank re-opening for business on Thursday. Since then, ING has admitted that "hundreds of millions of dollars", out of some £2.5bn deposited by pension funds, local authorities and individuals, have been withdrawn from the bank.