DB Advisors could gain up to $12bn in liquidity fund merger
DB Advisors, the institutional asset manager within Deutsche Asset Management, could win up to $12bn assets from rival Standard Life as concerns money market funds will fall under banking regulations has led to a vote on merging funds.
Standard Life Investments said it is to exit the constant-NAV part of the cash investment business, on the grounds it does not offer banking products to its clients, and global regulators are considering ushering treasury-style money market funds into the scope of banking regulations.
It will, however, remain in the variable-NAV asset management business, which includes some of its other money market products.
As part of SLI’s decision to leave constant-NAV money management funds, investors in the Standard Life Euro Liquidity fund are voting later this month on rolling their assets into the €10.1bn Deutsche Managed Euro fund, run by DB Advisors, part of Deutsche Asset Management.
Standard Life Investments Global Liquidity Funds plc is encouraging shareholders in its sterling, euro, and US dollar Liquidity funds to back the move. These share classes hold £5.6bn, €2bn and $172m respectively.
If a large portion of these assets came across DB Advisors’ fund would easily become the largest in its 24-member category of money market funds with a stable NAV, based on league tables of the Institutional Money Market Funds Association.
Mark Bolton, chief executive of DB Advisors UK, said: “We would be delighted to welcome investors in these funds to our global platform, which has deep resources, a robust credit process and a strong commitment to transparency.”
The ballot comes one month after DB Advisors successfully merged Henderson Global Investors’ Liquid Assets Fund into DB Advisor’s £223m Deutsche Managed Sterling fund, adding £2.5bn to its assets.
Db Advisors has more than €94bn in money market assets including US dollar, euro, and sterling pooled money market funds, and bespoke separately managed accounts.
Standard Life told investors the two portfolios were similar to one another, both being in Irish listed umbrella structures, having variable capital, similar remits.